Business Agenda Issue 07 by Malta Business Bureau

ISSUE 07 I JUN - AUG 2011

THIS ISSUE

HOSPITALITY A strategic policy for the restaurant sector is needed if its sustainability is to be ensured.

page 12

business agenda

NEWSPAPER POST Employment

Securing a value-added economy through education and the development of skills.

page 37

THE Official Business publication of the Malta business Bureau

MALTA ALLOCATED ALMOST A BILLION EURO IN EU FUNDS SINCE ACCESSION CORPORATE AFFAIRS Public Private Partnerships can offer a win-win situation for the public and private sectors.

page 15

CASE STUDY Playmobil Malta’s CEO, Helga Ellul, reveals just what it takes to secure long-standing commercial success.

page 28

Malta has been allocated over €944 million in EU funding through the 2004-2006 and the 2007-2013 programming periods, the new Permanent Secretary (EU Funds) within the Office of the Prime Minister, Marlene Bonnici, has revealed. In an interview with Business Agenda, Marlene Bonnici – who until the end of May was Director General of the Planning Priorities and Coordination Division, said the absorption rate of available funds is very good. She explains that for the 20042006 programming period, Malta received a total of about €85 million, which leveraged a total of €33 million in national investment, while an additional €855 million worth of EU funds have been allocated to the

EU POLICY

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“These amounts are expected to leverage a further €260 million in national investment by the end of the financing period,” explained Mrs Bonnici. In addition, the absorption rate of available funds has been very good, with full absorption of funds made available in the 2004-2006 programming period, and an 80 per cent absorption rate has already reached for the 2007-2013 programming period, which is expected to increase to practically full absorption by the end of this year. Full story on page 10.

THE EU HAS TAKEN A DISJOINTED APPROACH TO MIGRATION The European Union has taken a completely disjointed and disconnected approach to the migration challenges that have come about due to the severe unrest that has shaken North Africa and the Middle East, said Prof Stephen Calleya, Director of the Mediterranean Institute of Academic Studies.

What are the implications of the proposed changes to the EU’s Energy Tax Directive?

islands for Cohesion Policy 20072013. In addition, Malta also benefitted from €21 million under the Transition Facility.

Prof Calleya has stated that not enough is being done by the EU to tackle the heavy migration flows that have been caused by the unrest.

He stated that “when you have hundreds of thousands of displaced individuals within the proximity of the Mediterranean, you would expect the EU to react immediately to this, introducing a comprehensive mechanism in order to deal with this reality. Instead, we have a completely disjointed and disconnected approach; one in which there is no element of burden sharing and no element of solidarity.” See full story on page 30.

MALTA AMONGST MOST ACTIVE EU MEMBER STATES In a detailed interview with Business Agenda, the President of the European Economic and Social Committee’s Employer’s Group, Henri Malosse, has stated that Malta is amongst the most active members of the European Union and its approach to the migration wave that began this Spring has

shown that the country adheres to the European values of solidarity, responsibility and human dignity. Nonetheless, Mr Malosse believes that there is potential for civil society, especially youth, to be more engaged in EU affairs, See full interview on page 7.

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS AGENDA | JUN – AUG 2011

editorial

AT THE SERVICE OF MALTESE BUSINESS Malta Business Bureau fifteen years on By Joe Tanti, Chief Executive Officer, MBB The Malta Business Bureau has been in operation for the last 15 years, representing the interests of many Maltese businesses that are members of the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association with the various EU institutions. Recent years have seen a complete regeneration of the MBB both in terms of its service tangibility to members and also in its structure. The MBB’s initial role towards its parent organisations was to provide support and advice on EU related matters. However, this role has evolved to a more pro-active approach, seeking to provide direct assistance to Maltese enterprises in understanding better the regulatory challenges emanating from pipeline EU legislation, as well as encouraging and supporting businesses to

exploit the opportunities provided by the EU Single Market. A very important aspect is the need to better support and position Maltese companies to tap into public procurement opportunities in other EU member states. This prompted the MBB to recently launch an EU Tenders Alert service that contains procurement tender information for projects of a certain market value for which competitive bidding is allowed by economic operators irrespective of their operational location within 27 EU member states. This service is providing the Maltese business community with an opportunity to be duly informed of prospective business opportunities in the internal market. We consider this to be a very timely initiative. The European Commission is currently looking into the modernisation of the European public procurement market. Public

procurement accounts for roughly 17 per cent of the EU’s GDP and in times of tight budgets and economic difficulties stakeholders have voiced demands for a review of the EU public procurement system to streamline its procedures and better adapt them to new challenges. The new services being provided by the MBB follows up on the recent work on capacity building primarily aimed to generate tangible projects on the ground. The organisation has been very active in identifying and submitting EU-funded project proposals that could benefit its parent organisations with a positive roll-on impact on the member firms. At the time of writing, the MBB has been informed that its LIFE+ project proposal has been proposed for co-financing by the European Commission. The project, Investing in Water: Achieving Reduction in Water Consumption by Busi-

ness in Malta shall have as its main objective the encouragement of a behavioral change that will lead to increased adoption of best practices for water conservation. There is no denying that this is a project of national interest and a proactive initiative by business towards the sustainable use of water. The MBB is committed to playing a responsible role in the country’s sustainable development. Then again it is also the organisation’s role to safeguard business. Last year, the MBB placed impact assessments at the centre of its vision, initiating this process through a pilot impact assessment on the revision of the Pregnant Workers’ Directive. The MBB plans to conduct a number of economic studies on draft EU directives as proposed by the European Commission. Certainly the strategic partnership with Bank of Valletta will facilitate

the commissioning of a number of economic impact assessments. This is extremely important and highly beneficial to the local business community. The MBB believes that through such studies, it will be safeguarding Maltese business interests by drawing the attention of both EU and national public authorities to certain decisions that may hinder the competitiveness of particular sectors. The first in a series of MBBBOV economic impact assessments will focus on the effects that the proposed directive for a Common Consolidated Corporate Tax Base (CCCTB) would have on the Maltese economy and private enterprise. Fifteen years down the line, the MBB continues to embrace change, striving to be of better service to its members and to strongly communicate the agenda for business both at a national and European level.

COLLABORATING PARTNERS:

The Malta Business Bureau is a non-profit making organisation acting as the European Advisory and Support Office of the Malta Chamber of Commerce, Enterprise and Industry and the Malta Hotels and Restaurants Association. The MBB has two offices, the Head Office in Malta and the Representation Office in Brussels. Publisher Content House Ltd Mallia Buildings 3, Level 2 Triq in-Negozju Mriehel QRM3000 Tel: 00356 2132 0712/3 Email: info@contenthouse.com.mt www.contenthouse.com.mt

Malta Business Bureau Casa Leone Pjazza Robert Samut Floriana Tel: 00356 2125 1719 (Malta Office) Tel: 0032 4859 81124 (Brussels Office) Email: info@mbb.org.mt infobrussels@mbb.org.mt www.mbb.org.mt

Editor: Joe Tanti Deputy Editor: Claire Azzopardi

Editorial Team: Omar Cutajar, Daniel Debono, Mariella Scicluna

Business Agenda is the quarterly publication of the Malta Business Bureau. It is distributed to all members of the Malta Chamber of Commerce, Enterprise & Industry, all the members of the Malta Hotels & Restaurants Association, and to all other leading businesses by Mailbox Distribution Services, part of Mailbox Group. Business Agenda is also distributed by the Malta Business Bureau to leading European and business institutions in Brussels.

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS REPORT

MBB AND BOV TO COLLABORATE ON ECONOMIC IMPACT ASSESSMENTS The Malta Business Bureau and Bank of Valletta recently announced an agreement that will bring about the collaboration between the two organisations on joint-Economic Impact Assessments. BUSINESS AGENDA talks to MBB President, John A. Huber, and BOV Chief Executive, Tonio Depasquale, about this initiative. The Malta Business Bureau and Bank of Valletta have recently announced their joint decision to collaborate on the commissioning of a number of impact assessments, which will aim to identify the impact that certain EU proposal and decisions could have on the local economy. The first impact assessment is set to focus on the Common Consolidated Corporate Tax Base (CCCTB) which is being proposed by the European Commission, on which the Maltese business community retains some reservations. The proposed CCCTB was selected for this very reason; it is essential that the possible impact of the proposal is identified at an early stage, enabling local decision-makers to lobby at EU level, according to the Maltese economy’s needs. Reassurance has already been given by the Commission for an optional CCCTB, meaning that participation in this scheme is not mandatory for cross-border business operations. The CCCTB will run in parallel to the 27 different taxation regimes in place across the EU. It also means that the directive does not propose the harmonisation of member states’ corporate tax rates. Mr. John A. Huber, President of the Malta Business Bureau (MBB), stated that “nevertheless, we need to sustain the fundamental precept that differences in the applicable corporate tax rates amongst member states, allowing for a certain degree of flexible yet predictable

tax competition to be maintained in the European single market. This is critical to sustain Malta’s ability to attract sustainable and high added value foreign investment towards the island.” For this reason Mr. Tonio Depasquale, Chief Executive Officer of Bank of Valletta (BOV) believes that “it is important that we review its impact on Malta’s taxation system. We need to ensure that this directive has no negative impact on Malta’s financial services, i-gaming and manufacturing sectors, among others, which are complemented by our competitive fiscal framework. This will also indicate which sectors will be impacted most and to what extent.” Why Economic Impact Assessments? The fact that the European Union is a complex web of institutions and individual member states, is no news at all. However, few are aware of the in-depth negotiations and lobbying that takes place in Brussels prior to the Commission pushing forward legislation intended to be implemented across Europe. This wide consultation, with a diverse range of interested parties, means that the ultimate proposals may not necessarily be welcomed by all. Economic Impact Assessments are an efficient way to scientifically quantify whether concerns of any potential negative impact on an economy is justified or not. In other

words, the evidence-based conclusions derived from the studies, provide policy makers with a detailed picture of what the real effects on the national economy and the private sector would be, should the tabled proposals be implemented. This is increasingly being recognised in Malta. Mr. Huber claims that as soon as he took over the Presidency of the Bureau last year, he put impact assessments at the centre of the MBB’s vision for the organisation’s development. “We have initiated this process, initially through a pilot impact assessment on the revision of the Pregnant Workers’ Directive” he claimed. “This year we are consolidating this project as a core part of the Bureau’s operations with the plan of conducting a number of studies on draft EU directives as proposed by the European Commission in recent weeks as well as others that are expected to be published later this year,” he stated. Mr. Depasquale added that “these reports will assist to mitigate the relevant compliance costs whilst highlight the market opportunities that can enhance Malta’s competitive advantage. Following the principles laid down in the Small Business Act (SBA), we need to ensure that the European Union legislative framework does not over burden our SMEs and increase their operating costs. Therefore, these reports are expected to assist business stakeholders.”

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MBB and BOV: A win-win partnership The Malta Business Bureau’s role is that of voicing the interests of local businesses in Malta and the EU. On the other hand BOV is not only a business in itself, but through its wide range of clientele it is an enterprise that helps other businesses flourish, through various schemes it offers to SMEs. This confirms that both MBB and BOV are interested in the development and the safeguarding of business activity in Malta. Thus, collaborating together on economic impact assessments comes naturally. Mr. Depasquale said that “BOV has always been a prime mover in the financing of the industrialisation and modernisation of the Maltese economy. Only recently, the Bank announced its participation in JEREMIE – a joint initiative of the Commission and the European Investment Fund which forms part of the European Investment Bank Group. It aims to improve access to finance for small and medium enterprises and in particular the supply of micro credit, soft loans or guarantees and other forms of innovative financing.” Mr. Depasquale confirms that the two organisations have “a common mutual objective of assisting in the shaping of the local economy as a result of the new realities that have been evolving much more rapidly in the last decade.” He is confident that “this collaboration will further consolidate the excellent working relationship between both parties.”

Mr. Huber is proud that the MBB is associated with one of the major and most established credit institutions in Malta. He states that “the Bureau will benefit from this collaboration in various ways. First and foremost, BOV’s assistance will help make this project successful. Secondly, this will not only add to further establish the credibility of the work achieved by the MBB, but will also strengthen our commitment to conduct economic studies for the benefit of Maltese business.” How will the results be conveyed to the relevant stakeholders? “Upon publishing the results, the MBB and BOV will undergo a campaign with relevant stakeholders to inform about the effects that a prospective CCCTB as proposed by the Commission would have on Malta’s national economy and the local private sector” states Mr. Huber. “The MBB will also communicate the results to the Maltese Government as well as to our international partners in Brussels including BUSINESSEUROPE, EUROCHAMBRES and HOTREC. Furthermore, we plan to organise focused information sessions with specific membershipsectors of our parent organisations - the Malta Chamber of Commerce, Enterprise and Industry, and the Malta Hotels and Restaurants Association in order to discuss how the CCCTB would have a bearing on particular economic sectors.”

... it is essential that the possible impact of the proposal is identified at an early stage.

BUSINESS AGENDA | JUN – AUG 2011

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS AGENDA | JUN – AUG 2011

interview

“ There is potential to further

stimulate the engagement of civil society, especially youth... ” – Henri Malosse

OMAR CUTAJAR speaks to HENRI MALOSSE, President of the Employer’s Group within the European Economic and Social Committee, about civil society’s participation in Community matters and the various issues that affect businesses across Europe.

Could you explain what your role is and what the employers’ group within the EESC stands for?

A. The Employers' Group of the

European Economic and Social Committee represents national employers' associations, and through the work of its members, it defends and promotes the interests of employers and businesses to the European Institutions. We are an essential part of the European civil dialogue, and with our social partners, we give voice to civil society in the European policymaking processes. The Employers' Group has 114 Members who are entrepreneurs and representatives of entrepreneur associations working in industry, commerce, services and agriculture in the 27 member states. As its President, I coordinate the Group's political strategy and ensure the cohesion of all our initiatives.

Malta haS just celebrated seven years of EU membership - what is your judgement on Maltese civil society’s engagement on EU matters?

A. In my opinion, Malta is among

the most active Member States in

this matter; and especially after the migration wave began this Spring, the country showed that it adheres to the European values of solidarity, responsibility and respect for human dignity. There is a number of organisations in Malta which deeply involve themselves in EU matters, but there is potential to further stimulate the engagement of civil society, especially youth. From our end, the Maltese Members of the EESC are very active and we really appreciate all their work.

Often, the Maltese business community complains about the compliance costs of adapting to EU standards and regulations. Is the EESC’s Employers’ Group conscious about the need to reduce the regulatory burden on business?

A. Excessive compliance costs can

be a deterrent to the development of businesses, and SMEs experience more difficulties due to the fact that a higher proportion of their budget needs to be allocated to compliance costs. For almost 20 years now we have been building the Single Market, and a big part of the EU initiatives

have aimed to create and strengthen it, as well as ensuring a level playing field for everyone. During our March Plenary, we debated and adopted our opinion on the Single Market Act with the participation of Commissioner Barnier. Of course, we should not forget, and I ensure this is emphasized during all Employers' Group initiatives and events, that SMEs are the cornerstone of economic activity in the EU, so their development must be promoted and not hindered.

are such a vital part of our children's careers. In October, we are hosting a seminar on Trade as a tool for aid and development, and in November, we will organise the third edition of our YES Seminar, which aims to promote entrepreneurship among young people and create true European entrepreneurs with cross-border thinking.

Maltese employers are currently facing the adaptation costs related to the impact of the financial and economic crisis. How has the EESC contributed to the EU’s response to the crisis?

Besides the financial crisis, Maltese entrepreneurs are also confrontED WITH loss of business due to the political unrest and instability in North African countries, PARTICULARly in Libya. What actions is the Employers’ Group within the EESC taking to re-focus the EU’s economic policy in the Euromed region?

Employers’ Group members have presented own-initiative opinions which have examined the need for stimulating businesses to drive growth and create employment, better preparing the markets for crisis prevention and response, as well as reforming the educational and vocational training systems in order to adapt to the skills which will be necessary in the future.

A. We are actively promoting the

I recently hosted a panel debate on developing the STEM skills which

I am really deeply happy about the uprising in the Mediterranean coun-

creation, in North Africa and elsewhere, of involved and truly representative employers’ organisations and chambers of commerce, independent from governments which provide real value through a strong voice in the public debate, in order to create stable democracies and a spirit of cooperation and compromise.

tries. Democracy and freedom are the undeniable starting point for economic development. As I am French, I am particularly proud that my country, with other European and Arab nations, gives its fullest support to the liberation movement in Libya. I relate to Malta as my cultural background is Corsican, thus I emphasize the opportunities generated by tourism and the maritime industry – we should not underestimate the value of the sea. I hosted Commissioner Damanaki during a meeting of the Employers' Group and we debated on the European Integrated Maritime Policy, focusing on development in the Mediterranean and more specifically on the economic future of fishing, maritime transport and surveillance.

Moving to more specific issues, how would you assess the implementation of the Small Business Act? Is the Employers’ Group convinced that enough is being done to ease the operational burden for business?

For two consecutive years, the Employers’ Group has held a large debate with BUSINESSEUROPE,

BUSINESS AGENDA | JUN - AUG 2011

INTERVIEW

EUROCHAMBRES and UEAPME on the implementation of the European Commission's Small Business Act, because I believe that businesses, and especially small businesses, need to be supported. The current measures have not removed the obstacles to growth of SMEs, neither for innovation or job creation. Europe needs fewer strategies and more action, especially on finance, public procurement, entrepreneurship, vocational training and taxation. The issues which remain vital are access to finance (by defining EU regulatory measures for banks in a balanced way), access to markets due to the excessive red tape and lack of harmonisation in the internal market. Of course, a supportive regulatory environment is necessary which assesses the impact on SMEs of any new legislative measures.

Regulators should abide by the 'think small first' principle. Finally, the Council negotiations on the European Private Company Statute (SPE) which are still pending should be brought to an end, to allow smaller firms' ability to trade and grow across Europe.

Discussions on the reform of the EU budget as well as cohesion policy have started in earnest. How do you view the reform of the EU budget? Is the EU finally moving in the right direction of enhancing competitiveness across the board?

The EU budget represents 100 per cent of the EU GDP, compared to 25 per cent of the US GDP for the US Federal budget. With the increase of EU responsibilities following the Lisbon Treaty (taxation policy, energy, sustainable development, justice and innovation policy), the EU needs additional resources.

This should be achieved through an increase of the EU budget, as well as through additional complementarity between national budgets and the EU budget. In this perspective, the cohesion policy is a key issue for me, and I would like to see it strengthened and more focused on projects with a European dimension. I am deeply involved in the discussions on the EU budget reform, and as rapporteur on the opinion "The EU budget review", my proposals are to rely on own resources and to end the rebates on certain Member States. We must not base the EU budget on the principle of net contributions. It is imperative to consider the cost of Non-Europe and realise the amount of lost gains in efficiency and savings if procedures are done in double and triple. We should coordinate our actions in order to avoid the reform being slowed down by the European

power struggle and the division between the various member states and the European Commission. This is coming in a crucial period as we are coming out of an economic crisis, so any decisions we make should look forward to stimulating European growth and handling in the best possible way the challenges of migration and economic downturn.

The role of employers’ organisations is fast evolving in today’s socio-economic environment. What advice do you give to business organisations seeking to provide added value to their membership, especially small businesses?

A. The situation of the Employers’ Group of the EESC is unique because our Members come from all kinds of business organisations: employers’ federations, sectoral organisa-

tions, chambers and associations of SMEs and include actual entrepreneurs. In this aspect, no one can be seen as a role model regarding their added value. Despite this, I consider that employers’ organisations must provide an efficient lobby towards political authorities as well as support services which meet the needs of these SMEs. It is also crucial that employers’ organisations are able to anticipate changes in society, which means being able to exchange their views with civil society organisations such as consumers’, environmental, youth, women’s and so forth organisations (and this is the principal role of the EESC). In addition, these associations should be able to develop their own vision of society, including references on common values and common priorities, in order to promote a positive image of business in today’s socio-economic environment.

BUSINESS AGENDA | JUN – AUG 2011

AWARENESS

ASSISTING BUSINESSES TO CAPITALISE ON DATA By Louise Mifsud, Marketing Manager at Microsoft Malta

To a meteorologist, a cloud consists of billions of droplets suspended as vapor that can stretch for miles and subtly affect everything on the ground below. In an enterprise IT environment, billions of devices can gather data from interactions all over the world, and produce a profound effect on the way organizations plan, act and work. On the 20th, at the SMART Technology World conference in San Francisco, Microsoft Windows Embedded General Manager Kevin Dallas illustrated what clouds and cloud computing have in common, and explained why the Internet of Things is going to change the way enterprises capitalize on data. The Embedded Device Explosion Today powerful processors can be embedded into almost any kind of device. Operating systems for such devices have become small and powerful enough to facilitate a wide range of functions and interactions. And almost anything can be connected to the Internet. The combination of these factors has led to rising demand for computing power that extends well beyond the desktop and the server room out into the realm of everyday things, and this pressure is rapidly transforming the way embedded devices are built, the way they are used, and the value they provide across business and personal life. According to research firm International Data Corp. (IDC), the number of “smart systems” — devices with powerful processors, operating systems and connectivity — will more than double between 2010 and 2015, and double again within five years after that. Shipments of embedded systems with the ability to connect to the Internet will grow from approximately 1.4 billion in 2010 to over 3.3 billion in 2015. Microsoft Distinguished Engineer Yousef Khalidi, whose work has been foundational in Microsoft’s Windows Azure cloud operating system, says this proliferation of processing power embedded into a

range of devices poses both a huge challenge and an interesting proposition. “Today we have devices in cars, point-of-sale systems, production line environments and so forth, and this device universe will only increase,” Khalidi says. “It will go down to a small light bulb in every room having an IP address, sending data about its state. So the question really is, what do you do with all the data? How do you compute over it, run your analytics over it and make sense of it?” The Internet of Things In explaining this concept onstage, Dallas showed a short film featuring Dr. Abel Sanchez of MIT’s Geospacial Data Center, who introduced a new term into the technology lexicon. MIT’s theory of the Internet of Things describes an interconnected Web of devices that both collect and precipitate information. “The Internet of Things is a theory we developed at MIT to describe a state where the physical objects around us are interconnected by a network,” Sanchez says. “Now billions of things can be tracked, or can gather and process data, or can provide a service — and then through the cloud, all these things seamlessly interact.” According to Sanchez, the “things” involved can range from simple sensors that monitor humidity or motion all the way to intelligent devices with enough computing power to process large volumes of data. The potential result of this is something that Dallas calls “extended intelligence,” where devices continually feed information back to PCs and servers, providing rich, detailed data that allows for more insight and intelligence. According to Khalidi, all that data requires a vast amount of storage, as well as the processing power to make sense of it all, and that’s why the cloud is the essential element that makes the Internet of Things a reality. The connectivity of these

devices through Wi-Fi or cellular networks brings the cloud into play, offering near limitless computing power to process and analyze the information delivered by the devices. “To unlock the power of this data, powerful programs and services have to be able to aggregate it all, correlate the events and make use of the data,” Khalidi says. “And this computation has to run somewhere. And has to run on a very large scale. And for this, a cloud platform is ideal.” Khalidi says that Windows Azure, a very large storage system, is already able to consume and store all this data today. With Windows as a platform that extends from the device level, to the desktop, all the way to the cloud, developers can now capitalize on a tremendous opportunity to use their existing knowledge of Microsoft tools — and create the applications that will power this next generation of intelligent systems. “What excites me the most, frankly, are all the applications that have not yet been written to really unlock the power of the data,” Khalidi says. “The future is really very exciting. We like scale, and we have built a very scalable system in Windows Azure for that.” The Power of Smart Devices In describing the potential of intelligent systems, Dallas gives a simple example — gas pumps — explaining how advanced embedded platforms integrated into an appliance that has been around for more than a century can extend business intelligence all the way out to the customer’s fingertips. “Most people don’t think much about gas pumps, but when the data from sensors embedded in the pumps is aggregated, analyzed and compared with data from other nearby gas stations, all of a sudden some incredible business analytics can emerge,” Dallas says. “The enterprise that owns these gas stations can examine what types of fuel are selling better, what times

of day are most popular, and how pricing fluctuations affect sales.” That kind of detailed information can lead to better decisions on the part of the fuel company — more targeted delivery routes, for example, or highlighting high-volume regions that may benefit from a new gas station. Going deeper into the analytics and business intelligence, the company can identify new device functions and additional sales opportunities. Collecting the data through automated devices also creates inherent operational efficiency. “Because the devices are connected in real time, all this is done without the need to send someone to monitor each device, thus enabling the company to use its manpower somewhere else,” Dallas says. Embedded systems today have reached a point of such maturity and flexibility, Dallas says, that almost any kind of device can be transformed into an intelligent system that creates powerful information for companies. In fact, he says it’s already happening in industries all over the world. Stratospheric Possibilities According to Dallas, the Windows Embedded platform is capable today of powering almost any scenario that involves the exchange of information between embedded devices, PCs and servers. “When you add a Windows-based operating system to the device and the cloud, customers can absorb and then project almost any kind of data, easily and constantly,” he says. “When we look at the sheer volume of potential for this kind of information exchange, that’s what gets us so excited about what we’re doing.” Dallas says Windows Embedded offers the advantage of having Microsoft’s full arsenal — technologies, resources, industry experience and partner ecosystem — to develop extended intelligence

within an existing enterprise infrastructure, giving customers the ability to design an embedded solution that can fit any business need. “As you begin to plan how to use Windows Embedded and the cloud, we can match solutions to your needs, combine your technology with our tools, and help develop a next-generation IT infrastructure,” he says. Dallas notes other applications that have already been developed, including personalized digital signs for retail that respond to individual customers, connected health records that can help medical teams deliver more holistic care, real-time factory data that can keep inventories and raw materials moving in synchronicity, or consumerfacing intelligent devices such as embedded automotive infotainment systems featuring voice recognition to control entertainment and climate systems. Which brings up an observation from meteorologist Shannon O’Donnell, an authority on climate systems, who also appeared in Dallas’ video at SMART Technology today: “What I see Microsoft doing is recreating the power of the clouds, but with the added benefit of being able to control what goes into them, when it comes out, and where it goes. In this case, the question is no longer ‘What is this cloud going to do?’ but rather ‘What am I going to do with the cloud?’”

www.microsoft.com/cloud

BUSINESS AGENDA | JUN - AUG 2011

FINANCE

OVER €944 MILLION IN EU FUNDS HAVE BEEN ALLOCATED TO MALTA SINCE ACCESSION One of the benefits of EU membership is the chance for local businesses and NGOs to benefit from funding opportunities. BUSINESS AGENDA speaks to MARLENE BONNICI, the new Permanent Secretary (EU Funds) within the Office of the Prime Minister, about how EU funds allocated to Malta can reach their full potential.

Ask any businesses or organisation what the main benefits of EU membership are and the answers will certainly include funding, and rightly so. According to statistics compiled by the PPCD, Malta has been allocated an impressive €944 million under the EU’s Cohesion Policy, since it became a member in 2004. Ms. Marlene Bonnici, Director of the PPCD within the Office of the Prime Minister reels of the impressive statistics, explaining that “for the 2004-2006 programming period, Malta received a total of about €85 million, which comprised of €63 million under Structural Funds and €22 million under the Cohesion Fund, and these leveraged a total of €33 million in national investment. In addition, Malta also benefitted from €21 million under the Transition Facility.” Furthermore, an additional €855 million worth of EU funds have been allocated to the islands for Cohesion Policy 2007-2013, which are made up of €444 million under the European Regional Development Fund, €284 million under the Cohesion Fund, €112 million under the European Social Fund and another €15 million under the European Territorial Cooperation Programmes. “These amounts are expected to leverage a further €260 million in national – that is, public and private - investment by the end of the financing period,” explains Ms. Bonnici. “Overall, Malta will have received a total of €944 million in terms of Cohesion Policy assistance since accession to the EU and until the end of this programming period.”

But the fact that a substantial amount has been made available to the islands does not automatically mean that they are being utilised to their full potential. The business community has often cited overly bureaucratic procedures as being one of the main drawbacks of participating in EU funded projects. Nevertheless, it seems that bureaucracy or not, absorption of EU funds has been very successful. Ms. Bonnici explains that the absorption of 2004-2006 EU Structural Funds has been a success, with full absorption overall while, to date, the mainstream Programmes under the 2007-2013 financing period have registered a commitment of €590 million (representing 67 per cent of the total allocation) for Operational Programme I and €76.6 million (equivalent to 58 per cent of the total allocation) Operational Programme II. “These rates are more or less in line with the current implementation period which is approximately half way through. More commitments are expected to follow in the next months, when new projects currently in the pipeline are approved, with the Programmes reaching over 80 per cent commitments by the end of the year,” Ms. Bonnici explains. “By the end of 2012 both Programmes are expected to be fully committed with focus then shifting to payments, controls and requesting reimbursements from the European Commission.” The fact that there are actually so many funding opportunities available can sometimes make it a bit difficult to select the best one for a given project. But the PPCD has aimed to simplify the process by ensuring that public tenders are

issued for those projects that are to be implemented by public entities, NGOs and local councils. “Without the relevant private sector uptake of these tenders, the Programmes cannot be implemented and the funds cannot be absorbed. Public sector projects in themselves, therefore, create jobs and wealth in the private sector – apart from the results and impact on the lives of citizens,” Ms. Bonnici explains. “The private sector is also a direct stakeholder in the implementation as both Operational Programmes provide direct support to the private sector in the form of a number of aid schemes.” She continues to explain that aid schemes have been delegated to so-called Intermediate Bodies (IBs) namely Malta Enterprise, the Tourism and Sustainable Development Unit within the Office of the Prime Minister, the Department of Social Welfare and Standards and the Employment and Training Corporation. “In the case of the schemes under the ERDF funds - which are managed by Malta Enterprise, the Tourism and Sustainable Development Unit and the Department of Social Welfare and Standards - the IBs issue calls for project proposals for enterprises, which leads to competition between the projects,” Ms. Bonnici elaborates. “In this case not all eligible projects can be funded as only those that are successful in the selection will ultimately receive a grant. On the other hand the two aid schemes under ESF which are the Training Aid Framework and the Employment Aid Programm are demand driven, meaning that each application is assessed just for eli-

gibility, and is supported assuming funds are still available.” “In total, there are €68.4 million in public grants being provided to the private sector under both Programmes, and this is expected to leverage another €68.4 million in private sector investment,” explains Ms. Bonnici. “In addition to these grant aid-schemes, there are also funds made available through the JEREMIE instrument which aims to improve access to finance for micro, small and medium enterprises and the amount of public money from Cohesion Policy committed for this initiative is €10 million. This is expected to generate a portfolio of €52 million and any funds returned (when loans are repaid) to the Holding Fund will be recycled for similar initiatives in Malta.” Accessing EU Funds While there is no disputing the fact that there are huge benefits to be enjoyed thanks to EU funding opportunities, obviously it is essential that businesses know how to go about accessing them. Ms. Bonnici recommends businesses should ensure that complete project proposals including clear activities, quantifiable outputs, outcomes and impacts, are submitted in order to facilitate the selection process. “It is important that the proposed projects are adequately justified in terms of their need and this should ideally be substantiated by relevant statistics and data. The project – whether presented by a public entity, a private enterprise or a civil society organisation – should have a qualitative and quantitative justification for requesting public money,” she states.

She explains that it is also important that results are identified and quantified. Applicants should have a clear idea of what should be achieved through the project. It is not sufficient to say that the project will train 20 people or that new equipment will be procured – as these are supposed to be only the means to a more noble end, such as the fact that a substantial percentage of the trainees will find a job or that more pupils will choose science subjects or that a new health service will be introduced or that a niche market will be exploited. “It is equally important for entities implementing EU projects to have adequate internal capacity to handle the various administrative processes that accompany EU funding,” Ms. Bonnici continues. “The vast majority of EU Programmes and initiatives are loaded with multiple controls from various national and EU organisations and the repercussions of errors can be devastating, particularly for small organisations, as errors can lead to financial corrections.” Whilst there is certainly a lot of room for improvement in a number of areas, also by the authorities managing these funds, it is, however, satisfactory to note that public entities, local councils and NGOs are applying for EU funds and the private sector is also registering a good response under the different aid schemes. The demand is clearly responding and now it will be up to all the stakeholders together to ensure that we bring this money home,” she concludes.

EU funding opportunities

BUSINESS AGENDA | JUN – AUG 2011

Employment and Training Corporation (ETC)

LIFE+ Programme

Training Aid Framework: Employability courses are constantly being held. Subsidy period for funded training applications dated and received from 1/1/2011 onwards is 52 weeks.

Nature and Biodiversity Deadline: 18 July 2011

Employment Aid Programme: Subsidy period for applications dated and received from 1/1/2011 onwards is 52 weeks.

Environment Policy and Governance Deadline: 18 July 2011

Training Subsidy Scheme: Subsidy period for application till 2012 -2013

Information and Communication Deadline: 18 July 2011

www.etc.gov.mt

www.ec.europa.eu/environment/life/funding/lifeplus.htm

FP7 Programme (MCST) FP7 - ICT - Fuel Cells and Hydrogen Joint Undertaking - Call 2011 Deadline 18 August 2011 FP7 - ICT - Clean Sky - Research and Technology development project Deadline: 28 July 2011 FP7 - Cooperation - Joint call Green Cars 2011 Deadline: 2 December 2011 FP7-ICT-2011-C FET Open Deadline: 12 March 2013 Call for proposals for ERC Proof of Concept Deadline: 15 June 2011 and 8 November 2011 www.cordis.europa.eu Competitiveness and Innovation Framework Programme (CIP) Entrepreneurship and Innovation Programme (EIP) - European Alliance for Mobile and Mobility Industries and Creative Industries - Action 1 Deadline: 20 June 2011 Eco-Innovation - First Application and Market Replication Projects 2011 Deadline: 8 September 2011 www.cipmalta.com

Lifelong Learning Programme (EUPA) COMENIUS - In-service Training Second Call Deadline: 16 September 2011 GRUNDTVIG - In-Service Training Second Call Deadline: 16 September 2011 GRUNDTVIG - Visits and Exchanges Second Call Deadline: 16 September 2011 TRANSVERSAL -Study Visits Second Call Deadline: 14 October 2011 TRANSVERSAL -Preparatory Visits Deadline: 12 weeks prior to partner meeting www.llp.eupa.org.mt Planning and Priorities Coordination Department (PPCD) Call for Strategic Projects on Priority Axis 3 of the MED Programme Operational Programme: Improvement of Mobility and of Territorial Accessibility Deadline – 14 July 2011 Re-opening of the call on objective 2.3 of the MED Programme Operational Programme: Maritime Safety Deadline – 14 July 2011 Pre-Announcement to the Twelfth Call for Project Proposals under the European Regional Development Fund www.ppcd.gov.mt/calls_all?l=1 For further information on EU funded programmes contact the Malta Business Bureau on info@mbb.org.mt or on 21251719 or visit www.mbb.org.mt

BUSINESS AGENDA | JUN - AUG 2011

HOSPITALITY

RESTAURANT SECTOR NEEDS CLEAR POLICY DIRECTION TO ENSURE

SUSTAINABILITY

It may be one of the most important sectors in Malta, particularly when it comes to enhancing Malta’s tourism product, but the local restaurant industry is in urgent need of a more focused strategy if its sustainability is to be assured. CLAIRE AZZOPARDI explores the main issues that are challenging the sector.

Speak to any member of the population, any visitor to the islands, and the overwhelming majority would have dined in at least one of the thousands of eateries that can be found in each and every town or village. Yet, while local restaurants play an integral part in the local economy – both as a core element of the island’s tourism product, as well as a source of relaxation and enjoyment for the local population – it seems that the industry is in dire need of a clear strategy for the future. According to the President of the Malta Hotels and Restaurants Association (MHRA), “the dynamics of the context within which restaurants operate has changed quite dramatically in recent years. It is no longer viable for the sector to operate successfully without clear guidelines and a strategy for its future, which will enable operators within the industry to adapt to the changing market demands.” Mr Micallef explains that the sector plays an essential role within the local tourism industry and as such, it is even more important that a clear strategy for its continuous and sustainable improvement is devised, and as soon as possible. He also explains that with the current lack of concrete information, it is difficult, if not downright impossible, to determine the best way forward. In what can be termed as the first step towards developing clear policies and guidelines for the sector, the MHRA has taken the initiative to commission a survey, gathering essential data on the sector. The results show that the sector’s contribution to the economy is significant, with the total tax revenue from the restaurant sector estimated to be in the region of €62 million. Furthermore, it employs around 2.5 per cent of Malta’s workforce, almost 15 per cent people working in this sector are selfemployed, while just over 85 per cent are employees. Despite the important role it plays, Mr Micallef explains that “certain sectors of the local com-

munity are of the opinion that restaurants are generally overpriced and do not offer value for money. Unfortunately, very little information exists, to help establish the extent of this negative perception and the damage this has on this sector.” He continues to explain that this general perception contrasts with the relatively high satisfaction level registered by tourists visiting local restaurants, making proper research all the more important. Furthermore, the influx of customers from new source markets have resulted in a different ‘visitor profile’, bringing new needs and challenges to the sector, especially when it comes to satisfying a wide variety of tastes and maximising the level of satisfaction amongst customers. Parliamentary Secretary for Tourism, Dr Mario de Marco, is in agreement with the view that changing visitor profile is one of the challenges that the restaurant sector needs to tackle. “Surveys conducted by the Malta Tourism Authority suggests that while the general picture in terms of Malta’s catering offer is not negative, there is still a lot of room for improvement both in terms of the physical aspect of our restaurant offer and the level of service provided,” he states. “While around 75 per cent rate these aspects as very good or good, a worrying one in every four tourists rate them as not-so-good, poor or even very poor. Given the importance ascribed to this aspect of the tourists’ visit, our offer definitely needs to improve.” “We work hand in hand with the MHRA and other tourism related constituted bodies to ensure that the continuous development of our tourism industry remains at the fore,” he continues. “One practical initiative is the voluntary Quality Label Scheme for Maltese restaurants which focuses on the service offered by employees and will serve as an opportunity for restaurant operators to invest in the knowledge and skills of their staff members.” “This measure which is being launched by MHRA and with the full

Photo courtesy of the MTA

BUSINESS AGENDA | JUN – AUG 2011

HOSPITALITY support and endorsement of the MTA, is also an important step in the field of self-regulation by an industry body,” he continues. “It builds on the basic norms of licensing and classification provided by the state, and allows for an optional mechanism, which is properly managed and impartially run, to allow establishments to go that extra mile in ensuring an even better level of service than that contemplated by the existing regulations.”

Dr Gavin Gulia, Shadow Minister for Tourism agrees that meeting the market’s changing demands and satisfying different tastes is a challenge that local restaurants must face. “The challenge for restaurants is to adapt to the changing circumstances and offer meals and menus that satisfy different tastes and choices. Tourists are very demanding and expect to be served local food as part of their explorative experience of the Maltese Islands and I think restaurants

can do a lot more in this respect,” he explains. In addition, Dr Gulia states that “we still have to gauge what levels and quality of employment is being generated within the industry -it is not only numbers that matter but also the quality and the level of training and service by staff.” “I think that the authorities should make greater efforts to instil pride and job satisfaction in this

particular category of employment. The idea that anyone can do the job of a waiter is wrong and must be dispelled,” he says. In fact, the MHRA has formally proposed that a detailed study is undertaken in collaboration with the Malta Tourism Authority (MTA), which would aim to identify key trends within the industry and ultimately serve as a basis for drawing up a development policy for the sector.

“The study should identify the key issues affecting the sector and come out with proposals that can address identified concerns,” states Mr Micallef. “It should guide the sector as to how best it can realign itself with the industry needs at present in support to its development and that of the tourism industry, for years to come.” In addition to this, the MHRA would also like to see a number of other issues being tackled, including recruitment of staff, working conditions, the quality of the products and service on offer, pricing structures and competitiveness, the sector’s legal obligations and the high levels of bureaucracy involved in operating within the sector. Dr Gulia is in full agreement with the proposal, stating that there are two particular issues that need to be addressed. “The first is how government can reduce costs induced by excessive bureaucracy - operational costs, such as the utilities tariffs as well as price hikes in fuel and gas, are already reducing restaurants’ profitability and hampering investment. “I believe that the Institute for Tourism Studies has an essential role to play and must double its efforts to re-instil job satisfaction in Maltese trainees particularly in the waiters’ category,” he concludes.

"The study should identify the key issues affecting the sector and come out with proposals that can address identified concerns... PULL QUOTE

...it should guide the sector as to how best it can realign itself with the industry needs at present in support to its development and that of the tourism industry, for years to come." _ MHRA President, George Micallef

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS AGENDA | JUN – AUG 2011

CORPORATE AFFAIRS ELC Project - Gozo G˙ajnsielem

A PARTNERSHIP

THAT WORKS In a time where optimum efficiency and cost effective solutions are one of the few ways to secure entrepreneurial success, public and private entities are increasingly resorting to Public Private Partnerships. BUSINESS AGENDA explores what benefits the partnerships offer. Public Private Partnerships are an increasingly popular way of doing business. Whether it’s large-scale infrastructural development or the provision of care services for an ever-aging population, the merging of resources between the public and private sectors has proven to be an efficient way of doing business. In the EU alone, over 1,400 Public-Private Partnership – or PPP – agreements were signed in the last two decades, amounting to a capital value of around €260 billion, although the amount of new partnerships has fallen quite significantly as a result of the economy and financial crisis that hit the continent in 2008. Nevertheless, the crisis had also placed a great deal of strain on government finances and many argue that this should eventually augur well for the future of PPPs – the benefits that these partnerships offer are immense and usually result in a ‘win-win’ situation for the parties involved. In fact, the EU has established clear guidelines that are aimed at increasing the uptake of PPP agreements with the aim of using these

partnerships as way to raise additional capital, provide alternative management skills, provide better value added to the consumer and the public and ensure the optimal use of resources. The European Perspective According to the European Commission’s Director-General for Regional Policy, Mr Dirk Ahner, there is a growing interest in many EU member states in providing public investment through PPP. “This is not surprising in view of the scale of the effort required to bridge the 'infrastructure gap' which exists in Europe, and the serious budgetary constraints facing many countries,” he states. “Welldesigned PPPs can play a valuable role in mobilising new sources of capital from the private sector and can bring greater efficiency into the delivery of major investments.” He continues to explain that PPPs combining national funding and private participation are already well established in some countries and combining PPPs with EU grants has been tried successfully in several

countries, such as Portugal, Greece and France. “However, this type of PPP project is more difficult to prepare than the standard project,” he cautions. “The greater complexity and higher initial cost of this type of project, together with the limited experience in some public authorities of developing projects of this kind, may discourage the choice of this approach. Experience suggests that specialised expertise is required to structure successful PPPs.” In fact, the EU has taken a number of initiatives to increase awareness about PPPs and to improve the capacity of public administrations to develop them. Mr Ahner explains that two new initiatives have been set up to enhance the development of future PPPs. The first is JASPERS (Joint Assistance to Support Projects in European Regions), an initiative between the Commission, the European Investment Bank, the European Bank for Reconstruction and Development and KfW to assist the twelve countries which joined the EU in 2004 and 2007 to prepare major projects, including PPP projects.

The second initiative is JESSICA (Joint European Support for Sustainable Investment in City Areas) is another joint initiative of the Commission, the EIB and the Council of Europe Development Bank to provide assistance for urban renewal and development using innovative methods of financing, including the possible use of PPPs. “In addition to these two initiatives, the Commission is providing a substantial contribution to EPEC, a special PPP expertise centre in the European Investment Bank, which helps member states to develop PPPs by spreading best practice in this sector,” concludes Mr Ahner.

vate entities, they would be in a better position to fund projects which would otherwise be unsustainable,” he explains. “They would also be able to set their mind at rest in so far as scheduled maintenance on the medium term is concerned.” Dr Said continues to explain that PPPs are one of the methods that could be used in financing certain projects that are capital-hungry and for which financing is not readily available. “Luckily enough, in Malta there are enough private investors who are willing to enter into PPP arrangements with Government and with other public entities to push forward a number of projects,” he says.

PPPs in Malta The benefits of PPP agreements have long been recognised by the Maltese authorities. According to Parliamentary Secretary Dr Chris Said, PPPs have achieved a significant level of success in Malta, particularly in the construction industry and when it comes to the maintenance of residential roads. “Local Councils are becoming increasingly aware of the fact that by partnering Government and pri-

“To date, we have seen successful agreements being reached in various other areas including the construction and maintenance of local sports facilities and in the restoration of heritage sites,” he concludes. A Pan European Success Story PPP agreements need not be limited to the national level. With a bit of creativity and ambition, successful pan European agreements can be developed and implemented. One

BUSINESS AGENDA | JUN - AUG 2011

CORPORATE AFFAIRS such success story is the Europe of Traditions Consortium, which is quite probably one of the most ambitious Public Private Partnerships around. Mr Francisco Calheiros, President of TURIHAB – the Association of Manor Housing Tourism in Portugal, which forms part of the Consortium, explains that the project “has brought hospitality groups from five European countries together, with the common aim of seeking to preserve the heritage and culture of their countries and regions, and to share this heritage with their guests.”

the heritage that makes each region so unique, Mr Calheiros explains. “The characteristics that make up the country’s identity - including architecture, history and customs are an integral part of our heritage and by conserving them we can also reap economic benefits through niche market tourism.” Mr Calheiros explains that while the Europe of Traditions Consortium has been a huge success, it is not always plain sailing. “Coordinating a PPP that spans across five different countries is no easy task and it takes a great deal of accurate planning and dedication. Yet, the benefits make it worth the effort,” he states.

The project is the result of a common desire to preserve and promote

He explains that entering into a PPP may sometimes also require a culture change. “Experience has taught me that public institutions are sometimes not used to ‘handing over’ responsibility in certain areas to the private sector. On the other hand, the private sector often expects government to take full and sole responsibility when it comes to preserving and promoting a country’s heritage,”. “But, in my opinion, the most efficient results are always achieved when a balance is found – I urge both private and public organisations to accept the benefits that PPP agreements offer and to embrace them with mutual respect and trust,” he explains.

ELC Project - RAF Monument, Valletta

ENVIRONMENTAL LANDSCAPE CONSORTIUM The ELC Public Private Partnership with the Malta Government is perhaps one of the most successful PPP initiatives in the country. “The success of the contract lies with the continuous good intentions of both sides to make this work and maintain their drive for a Win-Win situation,” explains Mr Peter V. Calamatta, Chairman of the Environmental Landscape Consortium.

He continues to state that there is only one real incentive for the Consortium – the Government employees’ wages will keep being paid by the Central Government throughout the duration of the contract. “Apart from this, the ELC has to earn its way through the additional projects undertaken,”. However, it hasn’t all been plain sailing. Mr Calamatta explains that some of the chal-

lenges faced were of a significant scale. He spoke about how the main challenge they faced was how to ensure that the 300-strong workforce became a proud and professional team that delivered quality and high standards. “The Consortium immediately embarked on in-house training, uniforms, job specifications and health and safety equipment. We also created a fund for four extra quarterly bonuses which are given to the workmen

according to their performance and flexibility on the work site,”. Furthermore a great deal was invested in recruiting experts, sometimes from overseas, to work on certain projects, while Wied Incita Nurseries were transformed from a near “dump-site” to a top production unit, meeting all EU standards and which produces close to 2 million flower seedlings and 100,000 trees and shrubs on a yearly basis.

CASE STUDY

“The international and national financial squeeze has created problems of liquidity and income but with a number of sacrifices and daily planning this has been kept within an acceptably controllable level,” Mr Calamatta acknowledges. “But the Chairman and Directors will not lose sight of the original battle cry - that of Making Malta and Gozo more Beautiful.”

BUSINESS AGENDA | JUN – AUG 2011

BUSINESS AGENDA | JUN - AUG 2011

ENVIRONMENT

INSTILLING BEST PRACTICE IN

WATER CONSERVATION

Malta Business Bureau project to be proposed for co-financing by the European Commission The Malta Business Bureau has recently been informed that its LIFE+ project proposal will be proposed for co-financing by the European Commission to the LIFE+ Committee. The project will aim to bring about behavioural change to ensure best practices for water conservation amongst various sectors within the local economy. The project, entitled ‘Investing in Water: Achieving Reduction in Water Consumption by Business

in Malta’ will bring various stakeholders together in a bid to raise awareness on issues related to the water scarcity problem in Malta and the essential role played by industry in water conservation. “A two and half year awareness raising campaign will be organised as part of the project and will communicate and explain Malta’s obligations under the Water Framework Directive, our challenge of water scarcity, the economic and environmental costs of producing water from desalination plants

and the potential impact of anticipated climate change scenarios on Malta,” explains MBB CEO, Joe Tanti. “The project will also serve as platform to promote best practices when it comes to water management and conservation, hopefully stimulating others within the local business community to follow suit,” he continues. The MBB has submitted this project proposal with the Malta Chamber and MHRA as partners who will

be supporting the implementation of this venture. The MBB will also be teaming up with a number of local Authorities and organisations for the project, including the Office of the Prime Minister, the Malta Resources Authority, the University of Malta faculty for the Built Environment, and the Chamber of Engineers. “Through this project we expect that the target audience will become more aware of the importance of sustainable use of water and, as such, adopt best practices

that will result in water savings,” explains Mr Tanti. He continues to explain that the key results the team aims to achieve include the adoption of best practices in 20 per cent of the target companies, a ten per cent reduction in the consumption of service water amongst certain industries, and a significant increase in the level of awareness of the issues at hand amongst both employers and employees alike.

THE NEED TO PROTECT OUR WATER RESOURCES Water is not just a valuable resource, it is a lifeline – for both people and the economy alike. Thousands of businesses and industries rely heavily on a constant water supply, but this supply is often taken for granted. Now, in a bid to secure sustainable development, the time has come for greater awareness to ensure the sustainability of Malta’s scarce water resources. Ing. Marco Cremona – Hydrologist and Founding Member of the Malta Water Association Ing. Marco Cremona, a renowned hydrologist who took the initiative to establish the Malta Water Association, explains that Malta’s water challenges should not be underes-

timated. He points out the fact that Malta is on the list with Bahrain, Jordon, Kuwait, Libya, Qater, Saudi Arabia, United Arab Emirates and Yemen as being the ten poorest countries globally in terms of water resources per inhabitant. Ing. Cremona cautions that the ultimate challenge when it comes to managing Malta’s water resources better will be “to bring about a re-appreciation of the value of water in this country, across the board. He explains that the onset of desalination (reverse osmosis) in the early 1980s has more or less ensured a reliable supply of water, at an affordable cost. “While this in itself is commendable, it has however shifted the water problem onto

the energy sector and has led to the abandoning of more sustainable methods of water capture and reuse, such as rainwater harvesting in valleys, public and private buildings.” “Moreover, the shift towards desalination was accompanied by an uncontrolled process of drilling of boreholes by the private sector with the result that we now have more than 7,500 registered private boreholes that are pumping groundwater relentlessly as if it were an infinite source and as if there were no tomorrow!” he exclaims. He continues to state that it estimated that Malta is over-pumping its aquifers by 11 million cubic metres a year, which amounts to

almost 50 per cent more than the sustainable yield. “Managing to reduce demand by this amount and substituting this strategicallyimportant source of water with a sustainable source will probably be one of the biggest challenges that the country will have to face in the next few years,” he states. “In our opinion, we are still far away from restoring a ‘wateraware’ culture in this country. The population has been bombarded with information campaigns on energy-consumption and waste separation, but little or no similar campaigns were conducted with respect to water,” he says. “Increasing awareness and educating stakeholders is key. There cannot be any significant change for the better unless the stakeholders

are informed about the current situation, what the challenges are and what needs to be done to pull Malta out of a looming crisis.” Dr Petra Bianchi, Director of the Environment Protection Directorate within the Malta Environment and Planning Authority Dr Petra Bianchi is no newcomer when it comes to raising awareness on Malta’s environmental challenges. As the recently-appointed Director of the Environment Protection Directorate within the Malta Environment and Planning Authority, she believes that sustainable water practices are key to ensuring that Malta’s water resources are managed effectively in the long term.

BUSINESS AGENDA | JUN – AUG 2011

ENVIRONMENT “The quality and quantity of fresh water in the Maltese Islands is under pressure due to human activity and demand, coupled with high population density,” she explains. “In response to these challenges, MEPA and the Malta Resources Authority jointly published an integrated water policy - the ‘Water Catchment Management Plan’ – which provides a number of measurable objectives for water resource management and conservation.” She continues to explain that the heavy extraction of water from aquifers, for both public and private use, has a negative impact on the quality of our ground water, although this is being addressed by the Malta Resources Authority through the control and metering of boreholes. “Treated waste water may provide an alternative for certain uses. Some industries, hotels and manufacturing firms are already treating their waste water and this is likely to become an important focus for business and industry in the years to come, thus improving water use efficiency and reducing pollution and wastage,” she concludes. Mr Manuel Sapiano, Senior Analyst within the Malta Resources Authority. Mr Manuel Sapiano, Senior Analyst with the Malta Resources Authority explains that there are two main challenges that need to be tackled when it comes to managing Malta’s water resources. The first is demand. He explains that “the demand for water by various economic sectors outstrips the sustainable yield of natural freshwaters and demand is only met by desalinated water in the municipal supply.”

The second challenge is quality. “The main aquifers are in direct contact with sea-water and are therefore very vulnerable to saline intrusions in response to pumping abstraction,” he explains. “Whilst other intensive human activities practiced on the land surface, mainly agriculture, have resulted in contamination by nitrates, which is very high in certain regions of the islands.” He also delves into the pricing of water as a commodity and explains that this is dependent on the quantities of water originating from two sources - namely groundwater and desalinated water. “Although the former source is cheaper, there are sustainability limits that constrain its extraction. Hence, desalinated water is increasingly required to cater for increasing demand,” he explains. “However, this is a costlier source since it requires the use of fossil fuels, namely gasoil and fuel oil, whose price has followed a rising trend since January 2009.” Mr Sapiano continues to say that in the last tariff review, it was agreed that the Water Services Corporation will follow the full cost recovery principle, whereby the total production costs, including fuel bill, is recouped from the price. “Hence, an increase in the demand for water will require an increase in desalinated water, which requires a corresponding increase in the use of gasoil and fuel oil, which is ultimately reflected in the price for water,” he states. Given the scarcity of this resource and the inevitable costs associated with its use, it is essential that effective measures are taken to ensure better management and increased levels of sustainability in the long term. “There are a number of pos-

sibilities and opportunities for a better management of the water resource,” Mr Sapiano says. “From a quantity perspective, we need to have increased efficiency in water use. At a national level the implementation of a leakage detection programme in the municipal supply network has seen the municipal water demand being almost halved since 1994. Efficiency measures are now being taken at the household level,” he explains. “Also, increased harnessing of alternative water resources such as rainwater runoff and treated sewage effluent will result in increased available volumes of water for use in specific sectors; in lieu of groundwater,” he concludes.

Some policies such as hydropower and bio-energy crops actually threaten the achievement of water management objectives.

The European Perspective Malta is not the only country in Europe that needs to promote better way to manage and conserve water. According to a spokesperson within the European Environment Agency, when it comes to the state of Europe’s water resources, it seems that while there are currently enough resources to meet demand - so far - overexploitation by a few industries is one of the key challenges that is being faced. The spokesperson explains that the total abstraction of freshwater across Europe is around 288 km3/year and represents, on average, 500 cubic metres per capita/ year. Overall, 44 per cent of the total water abstracted is for energy production, 24 per cent is for agriculture, 21 per cent for the public water supply and 11 per cent for industry, although there are strong regional variations. The Agency explains that “to meet the needs of a resource efficient future, sustain human and economic development and maintain the essential functions of our water ecosystems, an integrated approach to water resource management is needed. Full implementation of the Water Framework Directive and other water policies will be required to reach good status by 2015.” Unfortunately, some policies such as hydropower and bio-energy crops actually threaten the achievement of water management objectives. There is a need to strike a balance between the benefits of such policies, which usually come in the form of renewable energy, and the impacts on the ecological status of water bodies, adjacent land ecosystems and wetlands. The Agency spokesperson concludes by stating that “Europe cannot endlessly increase its water supply - it must reduce demand and policies are needed to encourage demand management. Demand measures could include the use of economic instruments; water loss controls; water-reuse and recycling; increased efficiency in domestic, agricultural and industrial water use; and water-saving campaigns supported by public education programmes.”

BUSINESS AGENDA | JUN - AUG 2011

Business News MBB Update

11th May –

04th April –

AMIE launched in Malta The “AMIE” project was officially launched in Malta during a half day event whereby the ten Maltese Female Entrepreneur Ambassadors were introduced to the stakeholders and the local media. The partner organisations of this project, Foundation for Women Entrepreneurs, the Malta Business Bureau, Reach Beyond Foundation, the National Council for Women, and the Malta Association of Women in Business are coordinating a project under the Competitiveness Innovation Programme (CIP) funded action no. ENT/ CIP/09/E/N08S003.

through the establishment of a Network of Women Ambassadors. This network is part of an extended European Network of Women Entrepreneurs, and together they campaign amongst unemployed women, women in active professional life as well as students to set-up their own businesses and become entrepreneurs.

In addition, the Ambassadors act as role models so as to raise women’s ability to create a vision for themselves as entrepreneurs as well as the required motivation and self-confidence in setting up and creating a successful business. See page 27 for more details about the project.

The project, which will run until November 2012, aims to promote female entrepreneurship in Malta

04th MAY –

MBB launches new service for its members:

EU TENDERS ALERT EU Tenders Alert is an e-service that contains procurement tender information on projects taking place across the 27 EU member states, which the Maltese business community can benefit from. This service provides the members of our parent organisations with the opportunity to be duly kept informed of prospective business opportunities across the EU. The service aims to provide the necessary tender-related information via a light businessfriendly notification system,

therefore avoiding complex political or bureaucratic jargon. EU Tenders Alert addresses the following sectors: Construction, Environment, Health, IT, Publishing and Printing and Services. A bi-weekly email including new tenders is circulated to those registered, informing our esteemed members to access new information and updates directly online from the Services section of the MBB web portal.

EU Tenders Alert can be requested by registering with the MBB’s business portal www.mbb. org.mt. This service is free only to the members of the Malta Chamber of Commerce, Enterprise and Industry and the Malta Hotels and Restaurants Association. The MBB would like to credit Mr Mark Seychell, an EDRC student at the University of Malta, who is currently undergoing a traineeship at the Bureau, for his contribution in the materialisation of this project.

04th May –

MBB welcomes German delegation TO its offices The Malta Business Bureau was pleased to host a German delegation that was visiting various institutions and organisations related to business in Malta. The delegation consisted of a number of young apprentices from the public sector, who are all involved in providing easily-accessible, publicly-financed

business services: information, consultations, training and informational seminars for businesspeople and employees of companies. The MBB was approached to welcome the delegation at its offices and to give a presentation outlin-

ing its work and mission. The MBB prides itself in conducting such sessions, which enable it to extend information about its purpose and of its services to foreign delegations. The visit was coordinated by Paragon Europe.

MBB MEETS WITH SPECIAL ENVOY FOR SMEs MBB Executive, Mariella Scicluna represented the MBB in a meeting with Mr Daniel Calleja Crespo, Deputy Director General of DG Enterprise & Industry (ENTR) and Special Envoy for SMEs, as well as Dr Joanna Drake, Director DG ENTR responsible for SMEs and Entrepreneurship and Deputy Special Envoy. During the meeting Mr. Calleja Crespo stated that it was of utmost importance that the EU goes back to the real economy thus noting that currently a review of the SME Policy was being carried out, with a focus on three pillars, the Small Business Act, Access to Finance, and SME Internationalisation. He also announced that each country should have a national SME envoy. In Malta’s case, it will be Parliamentary Secretary for Small Businesses and Land, Hon. Jason Azzopardi.

During the meeting, The importance of simplification was highlighted, and the fact that Malta is yet to have a corporate ID number system was pointed out. On the issue of Access to Finance, it was remarked that the European Investment Fund lacks a scheme designed for start-ups even though incubation centres are very important. On the internationalisation of SMEs, it was stressed that market research and harmonisation of standards is still lacking, as well as the concept of a true one-stopshop. It was also noted that the EU is not capitalising on trade agreements with third countries, while ease of access to materials, as well as the strengthening of the internal market is a growing problem. Stakeholders, such as the Malta Chamber, MHRA, Malta Enterprise, Gozo Chamber of Commerce, and GRTU also attended the meeting.

BUSINESS AGENDA | JUN – AUG 2011

MBB UPDATE 12th May -

19TH May -

MBB EXECUTIVE BUSINESSEUROPE Convenes its Executive attends Brussels Economic Forum Committee (EXCO) Businesseurope held its Executive Committee meeting with Malta Chamber being represented by the MBB’s Permanent Delegate in Brussels, Mr. Omar Cutajar. The Executive Committee (EXCO) convenes three to four times a year to take strategic decisions regarding both the operational and policyaspects of Businesseurope’s management agenda. The EXCO meeting in particular focused on the Commission’s economic governance package and how these legislative proposals should help steer forward economic recovery across the European Single Market. Furthermore,

the renewal of the EU’s internal market was indeed the core issue discussed at Businesseurope’s EXCO meeting. An informal exchange of views with DG Markt’s Director-General, Mr. Jonathan Faull was held touching on several aspects related to the twelve priority initiatives as announced in the final ‘Single Market Act’. Representatives of national employers and industry federations highlighted amongst others the emerging concerns covering matters such as the extended scope of services standardisation, the growing over-regulation of the single market from a social per-

spective and the European Commission’s failure to cap gold-plating in the implementation of EU directives especially in the sphere of cross-border public procurement. The meeting came to an end with a discussion on the recentlypublished White Paper on Transport with a business assessment of the proposed policy options as presented by the European Commission. Members were invited to attend the next institutional meeting of Businesseurope - the Council of Presidents, taking place on the 9th-10th June, in Budapest.

12th / 13th May -

HOTREC General Assembly in Zurich MHRA President, George Micallef, MHRA Vice President, Tony Zahra, and MBB CEO, Joe Tanti, attended HOTREC’s General Assembly organised in Zurich. This was the 62nd General Assembly of the organisation which expressed caution about proposals being discussed in the International Standardisation Organisation (ISO) to standardize the quality and service offered in hotels worldwide. The European hospitality industry is very much concerned that a set of international standards proposals dealing with quality criteria in lodging

and service provision requirements in accommodation establishments, would indirectly force European hotels to offer standardised services according to criteria imposed on a top down approach. Strictly standardised services are clearly against the interests of tourists, who are travelling to experience the diversity of services offered by different countries. Also, on this occasion of the 62nd General Assembly, HOTREC welcomed four new members representing the interest of the hospital-

ity industry in Cyprus, Luxembourg and Turkey. President Mr. Kent Nyström stated that HOTREC’s growing membership confirms its success in representing and defending the interests of the hospitality industry in the EU. The latest additions will help the organisation gain even further legitimacy and effectiveness in its activities. The next General Assembly of HOTREC will take place in Copenhagen in October.

13th May -

Daniel Debono, Executive at the Malta Business Bureau attended the Brussels Economic Forum whose agenda was that of “Rethinking Economic Policy in Europe – A New Era of Economic Governance”. This annual event has now come to its twelfth edition, and saw the participation of a number of decision-makers, opinion leaders, and other key players from government authorities, international organisations, European institutions, financial institutions, social partners and academia. In other words, the Brussels Economic Forum has become the EU’s platform for debate on economic issues. Among others, the Commissioner for Economic and Monetary Affairs Olli Rehn and the President of the European Commission José Manoel Barroso addressed the Conference. Mr. Rehn gave an overview of the European economy’s progress since the financial crisis. He stated

that by 2012 the EU would already have reached pre-crisis level of real GDP despite the political uncertainties in the Mediterranean and Middle-East. He however warned that despite budget deficit in Europe is falling; public debt still remains at very high levels. Mr. Rehn insisted that structural changes are required to avoid potential growth to remain fairly modest. Mr. Barroso claimed that despite the difficulty to administer an economy during and immediately after a crisis, Europe is committed to sustain its Social Market Economy. In his view, in politics and economics, sticking to a cause is a virtue. He welcomed the fact that there is a clear wind in favour of economic reform in Europe, which is leading to positive results in member states despite recovery is registered at different paces and different rhythms. In his view, the way forward is for Europe to be more robust.

MBB announces new Board of Trustees The Malta Business Bureau announced two new members on its Board, Mr Charles Brincat and Mr Sergio Vella. Mr. John A. Huber was nominated to serve as President for a second consecutive year, while Mr. George Micallef, Mr. Anthony Zahra and Mr. Anton Borg have all been re-confirmed.

While welcoming its new Board members, the Malta Business Bureau would like to thank outgoing board members Mr Tancred Tabone and Mr. Mario Spiteri for their service and contribution to the constant development of the organisation.

MBB PERMANENT DELEGATE ADDRESSES the eleventh edition of the Forum of the Adriatic and Ionian Chamber of Commerce in Montenegro A presentation on the role, scope and activities of the ‘Blue Chamber Network’ was delivered by the MBB’s Permanent Delegate Omar Cutajar, at a conference organised by the AIC Forum in Montenegro. The 11th edition of the AIC’s Assembly was also held on the margins of the conference. The conference dealt with different issues however all related to the main theme of the development of an integrated maritime policy for Europe. Several working sessions were held tackling various perspectives on the evolving debate linked to EU maritime-

policy formulation. Discussion panels featuring EU Commission officials from DG Mare and senior representatives from stakeholder organisations were held over the span of the two-day conference proceedings. Issues discussed included short-sea shipping, the territorial dimension of the EU’s integrated maritime policy priorities and sub-regional cooperation structured around the various sea-basins in Europe such as the Baltic Sea, the Black Sea and the Adriatic/Ionian Seas. The presentation delivered by Mr. Cutajar, focused on the

added value that the ‘Blue Chamber Network’ can bring about for Chambers of Commerce with a key interest in maritime-related industries. The Blue Chamber Network was launched in March 2010 in Brussels with the intent to address the threefold-challenges of the enlarging scope of EU maritime regulation, the need to better network the diverse stakeholders representing the various sectors of the private maritime industry and finally, to create a critical mass for tapping into EU-funded projects assisting the maritime industries.

BUSINESS AGENDA | JUN - AUG 2011

MBB UPDATE 20th MAY –

MBB and BOV in a strategic collaboration to conduct Economic Impact Assessments The Malta Business Bureau and the Bank of Valletta have signed a collaborative agreement that has sealed their collaboration commitment on a number of detailed economic impact assessments. The agreement was signed by MBB President Mr. John A. Huber, and BOV CEO Mr. Tonio Depasquale. Economic Impact Assessments serve an extremely important purpose in providing evidencebased conclusions derived from the studies on various economic issues and provide policy mak-

ers with a realistic picture of the effects that certain proposals and decisions can have on the local economy. The Malta Business Bureau has stated its conviction that through the commissioning of such studies, they will be safeguarding Maltese business interests by drawing the attention of both EU and national public authorities to certain decisions that may hinder the competitiveness of particular sectors.

Assessment will focus on the effects that the proposed Common Consolidated Corporate Tax Base Directive (CCCTB) would have on local businesses, particularly foreign firms operating in Malta as well as the general economy at large. This topic was selected for study since the Maltese business community has expressed its reservations on the CCCTB proposal as it currently stands. See page 4.

It was also revealed during the event that the first joint-Impact

Upcoming Events

16th JUNE –

'Business Meets MEPs' Session with MEP Louis Grech The Malta Business Bureau is organising the third in a series of information sessions Business Meets MEPs. This event entitled ‘Relaunch of the Single Market and what it means for businesses’, will concern the implications of the Single Market Act, recently published by the European Commission. MEP Grech will be interviewed by The Times Journalist Ms. Joanna Ripard about themes of concern to Maltese business. Among others, the discussion will delve into what the Single Market Act is

all about; what kind of market access obstacles will the Single Market Act aim to remove; and how will the Single Market Act's proposals concretely help Maltese SMEs better access the European Single Market. The event will be held on Thursday 16th June 2011 (15:00-17:30) at the Hotel Phoenicia, Floriana. Registrations are accepted on info@ mbb.org.mt or 21251719 on a first come first served basis. Proceedings will be held in English.

BUSINESS AGENDA | JUN – AUG 2011

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS AGENDA | JUN – AUG 2011

AWARENESS

Family Friendly Measures are available to both genders! Use them. Access to Family Friendly Measures is increasingly becoming a commonly requested working condition. There is a wide range of measures including flexi time or a flexi hour in the morning, longer parental and paternal leave allowances, availability of reduced hours arrangements for a definite period of time, subsidies for childcare cost, teleworking, job sharing and urgent family leave. In the age when it is increasingly a disadvantage for families to rely on a single breadwinner, the necessity arises to create a balance between working life and family responsibilities. With this comes the dilemma of which parent should put their career on hold to see to the needs of the family especially for the first tender years of their children. The stereotype has been modelled on the woman putting on hold her career prospects to fulfill the primary caring role and thus taking parental unpaid leave, go on to part time employment, make use of reduced hours arrangements or even quit her job completely. Men are at times quoted to be reluctant to opt for reduced hours and thus a reduced salary even if their partner has a higher remu-

neration potential. This could be due to fear of bullying by co- workers or relatives who still believe in the patriarch model of society. A myth seems to prevail that women are more nurturing or more able to care for the young than their male partners. Yet these roles are not inherent in biology but socially dictated. One therefore questions if for the sake of traditional stereotyped roles, couples automatically assume that the caring role within the household should be taken up by the mother. Could there be cases where it is more financially sound for the father to shoulder more family-life commitments? While new mothers are entitled to 14-weeks paid maternity leave, the Legal Notice 225 of 2003 grants 3 months unpaid parental leave for every child to each parent allowing also fathers and mothers time to bond with the child. Similarly, both parents may resort to working on reduced hours thus resulting in a less pronounced dent in the family’s income while better safeguarding the career prospects and progression of the female. Employers who grant their employees family-friendly measures over and above what the law

prescribes and allow equal access to both genders, could qualify for the Equality Mark, a certification offered by the National Commission for the Promotion of Equality (NCPE) through a project co– funded by the European Social Fund. The Mark aims to recognise the efforts of organisations in promoting gender equality and showcase their commitment and best practices to employees, potential employees and business partners. Amongst the other criteria for certification, an organisation is expected to have a policy against discrimination and sexual harassment, evidence of equal opportunities in every aspect of recruitment, employment and training. If you feel that your organisation deserves the Equality Mark, then you only need to contact us to apply. The upcoming information sessions will be held on the 10th May at 10.30 (Maltese) and 1st June at 13.00 (English) at our premises. Attendance and application are free of charge.

The BIOM Project: A Revolutionary Shoe The BIOM Project is the revolutionary running and walking shoe concept from ECCO. Their philosophy is to let the foot move in its own natural way. Walking is one of the most natural motions for human beings. The human body has adapted to this forward motion over hundreds of thousands of years. Every bone, muscle, tendon and ligament of our foot is constructed to walk and run. Running increases stress on the foot structure therefore ECCO have created BIOM - a shoe that supports the foot just where the support is needed and in a natural way. The BIOM Walk models are developed for your sporty, walking activities or your everyday leisure wear. BIOM Walk gives the foot just the right amount of protection, while enabling it to follow its optimal barefoot motion. Training

is based on your body’s capacity to respond to effort by becoming stronger and fit. With this in mind, ECCO designed BIOM Train. The BIOM Trainer is a multipurpose training product. No matter if you go to the gym for a work out or out for a run in the park, it allows your feet to move and train to become stronger with each session. The BIOM Run model was designed with casual runners in mind, runners which need a little more support and protection without limiting the natural motion of the foot. The flexible, anatomical construction offers enough protection for hard surfaces and offers a natural running experience.

running experience. Visit www.ecco-shoes.com.mt to view the full collection.

The National Commission for the Promotion of Equality can be contacted by phoning 2590 2850, by email on equality@gov.mt or visit our website www.equality.gov.mt for more information.

Lucky visitors win with Sara Grech & BMW at the Malta Property Expo Luck comes in different ways and there were three individuals who came out smiling from the Malta Property Expo last month! Three lucky winners had the opportunity to win some luxury gifts when visiting Sara Grech’s stand at Expo in partnership with the company’s corporate partners. Malta’s leading estate agency had an innovative stand which offered personalized service through and through with Sara Grech present on the three days of the Expo where she also met hundreds of inquiring visitors personally. Denise Formosa & Charles Borg landed a luxury weekend break at the Kempinski Hotel in San Lawrenz – the epitome of luxury living on the lovely island of Gozo. Additionally BMW Group Malta and Muscat’s Motors provided the winner with the use of a free BMW over the weekend – the ideal tonic to race around Gozo and experience the sights and sounds of the magical sister island – what more can one ask? Margaret Mifsud and Darren & Lorna Mugliett who also entered the prize draw came out with a stylish BMW suitcase and a BMW wallet respectively – both luxury items which certainly enhance the brand and offer the owner that much more in style and class. It was a way of taking out a part of the Expo’s little luxuries and

The TV Guide – a new entertainment magazine out with The Times every Saturday was certainly well received by the lucky winners. “We were overwhelmed by interested visitors who participated actively in our competition as an added tonic to visiting our stand. I would like to take this opportunity to thank our corporate partners; BMW Group Malta, Managing Director Konrad Baumgartner and Henry Scicluna, General Manager for Muscat’s Motors who were very generous with their co-operation offering a Kempinski Hotel experience in a BMW for the weekend in this luxurious five star property – surely a dream for many”. The Malta Property Expo was a substantial success with thousands of prospective clients visit-

ing the various stands on offer and which demonstrate the current upturn in the property market. There was a huge amount of interest in the many exciting projects currently on offer as well as resurgence in those enquiries coming from first time buyers with the market showing significant positive movements when compared to the same period last year. Sara Grech will continue to showcase the latest in property development together with their corporate partners and many offers and deals are to be expected in the near future.

For further details visit www.saragrech.com or send an email to sara@saragrech.com

Want to know everything that’s happening on the entertainment and the show-biz front, both in Malta and abroad? Now there is just the magazine for you – The Times TV Guide, distributed every Saturday with the newspaper. The TV Guide is the first publication of its kind for the Maltese islands, delivering detailed and up-to-date information about everything that will be showing on the most popular local and foreign television channels throughout the following week. Television channel listings offered within the guide include GO and Melita cable channels as well as Maltese and Italian channels. The TV Guide also includes an exciting mix of features, interviews and gossip featuring the latest news on the local entertainment front with a good sprinkling

of international flavour. That’s not all; there are prizes to be won and more, so make sure you pick up your copy of The TV Guide with the newspaper every Saturday. The TV Guide is a weekly magazine published by Allied Newspapers Ltd and distributed with The Times of Malta.

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS AGENDA | JUN – AUG 2011

ENTREPRENEURSHIP

PROMOTING FEMALE ENTREPRENEURSHIP IN MALTA Mariella Scicluna, Executive at the Malta Business Bureau, gives an insight to the AMIE Project.

Although there has been an encouraging upturn in the number of women running businesses in the past decade or so, much more needs to be done to overcome the specific factors which discourage women from starting or taking over small firms. With this aim in mind, the Foundation for Women Entrepreneurs, together with Malta Business Bureau, Reach Beyond Foundation, National Council for Women and Malta Association of Women in Business are coordinating an EU funded project entitled Ambassadors in Malta for Increasing Women Entrepreneurs. The project is also known as ‘AMIE’ and is being funded under the Competitiveness Innovation Programme (CIP). Through the AMIE project, the partners aim to give information and ‘training’ to women so that from a young age they are taught to believe in themselves and trust in their own ability to open and run their own business. The promotion of female entrepreneurship is envisaged to be achieved through the establishment of a Network of Women Ambassadors. This Network, which shall be

part of the European Network of Women Entrepreneurs, shall campaign amongst unemployed women, women in active professional life as well as students, to set-up their own businesses and become entrepreneurs. Statistics of women in selfemployed work in Malta are not very encouraging since they are considerably low, particularly when compared with self-employed male workers. Even though there are more female than male students at the University of Malta, employment statistics show that women only represent 34 per cent of the workforce, whilst the average in the EU is 52 per cent. This ranks Malta as the country with the lowest amount of women participating in the labour force. When looking at data of women registered as self employed it is even less heartening, as they only amount to 18.5 per cent. Thus the role of the Female Entrepreneurship Ambassadors is to engage in a number of activities targeted at students and women. These activities shall include visits

to schools and also educational sessions for women in employment and those seeking gainful occupation, whereby the potentials of entrepreneurship shall be outlined and discussed. The project shall also target indirect beneficiaries who are deemed to be, for the purpose of AMIE, guidance teachers and stakeholders such as the Malta Chamber and MHRA who are both supporting this project. Furthermore, the objective of the Ambassadors is to act as role models to highlight women’s ability to create a vision for themselves as entrepreneurs, as well as to raise the required motivation and selfconfidence in setting up and creating a successful business. Maryrose Francica, Executive Coordinator for the Foundation for Women Entrepreneurs said that “the Foundation is very pleased to coordinate the AMIE project as it falls directly within its priorities to carry out activities to increase the potential of women becoming entrepreneurs. The Female Entrepreneur Ambassadors, who come from diverse business sectors shall inspire other

women to become entrepreneurs by ‘telling their story’, thus fostering the entrepreneurial spirit.” Storytelling is an effective way of reaching out to an audience and to enable people to learn. When people are engaged in other peoples’ stories they feel like they can relate to the person, and they are likely to be more easily inspired to chase their dreams, and open their own business. The message that these successful business owners are trying to convey is that if they managed to make it through all the ups and downs of creating and successfully running their own company, then others are also capable of taking this step. What is required from an entrepreneur is to have a definite goal and the determination and dedication to make it happen. Owning your own company is very satisfying, especially when you reap positive results and the mere fact of being successful is deeply gratifying. Obviously owning one’s own business has both its merits and its

disadvantages. When being a female entrepreneur, the possibility of having a more flexible schedule is more achievable, while on the other hand it is still a men’s world so difficulties and obstacles will surely be encountered. On a European level, 207 Women Entrepreneur Ambassadors are promoting entrepreneurship in all the EU 27 member states. Thus MBB’s main role in this project is to ensure a smooth interface between the Network of Ambassadors in Malta together with the Network of Ambassadors across Europe. Focusing on these synergistic efforts will give further strength to the Network in Malta which shall also benefit from the pan-European campaigning efforts. This objective is very important as it would create a combined effort with other networks of Women Ambassadors across Europe. Furthermore the shared experiences and EU campaigns at a European Level can only enhance further the activities being carried out locally.

BUSINESS AGENDA | JUN - AUG 2011

CASE STUDY

PLAYMOBIL MALTA’S SECRET FOR SUCCESS Playmobil has become an established household name in the four decades it has been operating in Malta, contributing significantly to the local economy. BUSINESS AGENDA speaks to Chief Executive Officer, Helga Ellul, to explore the dynamics that drive one of the most successful companies on the island. “It all started back in the early 1970’s. Malta’s economy was ripe for investment – the low labour costs, the country’s European ties and its English-speaking population were a huge incentive for opening a branch on the islands,” explains Mrs Ellul as she begins to explain Playmobil’s roots in Malta. “Ever since those first years of operation, we have always striven to deliver the highest possible quality and standards, and this, coupled with the company’s strong and continuous investment in its workforce, has ensured that it has gone from

strength to strength throughout the years,” she says. This approach has certainly paid dividends. Today, Playmobil Malta employs just over 950 people and is celebrating 40 years of operation on the island. Mrs Ellul explains that the single most important factor that allowed such growth and development to take place was the management’s focus on human resources. “While Malta may be very limited in terms of natural resources, its people certainly make up for

that!” she explains. “Playmobil has a clear policy of investing heavily in its people – ever since operations were established in Malta, we have always provided our staff with ample opportunities for self development and career progression – we find that the approach is exceptionally beneficial as our staff is motivated, they take responsibility and they grow with the company.” And it would seem that Playmobil’s philosophy of placing its people at the core of its operations is not just talk – it is a philosophy that is actively put into action. In fact, the

company invests heavily in specialised training to keep staff up to date with its every evolving technologies, but has also developed an education programme, We Learn, that gives employees the opportunity to develop other skills that may not even be directly related to their role within the company. “The We Learn programme was specifically designed to give our people the opportunity follow short courses in various subjects, including languages and mathematics, with the aim of enabling self development and an eager-

ness to embark on lifelong learning,” explains Mrs Ellul. “The programme has proven to be a great success and we currently have over 350 employees who are following one course or another.” “We also make it a point to be as flexible as possible with our staff, of course within the constraints of the nature of the industry,” she continues. “While we have machines working 24/7, which must be manned, we are open to partnership arrangements where two employees can jointly make up a 40 hour week, and we also offer flexi

BUSINESS AGENDA | JUN – AUG 2011

CASE STUDY time and tele-working when possible. We understand the challenges that exist when it comes to striking a health work-life balance and we do make it a point not to hinder our staff when it comes to attaining it.” In line with the importance it gives to its employee’s development, The company also employs a specialised training manager who oversees the overall training strategy and its implementation. “Training is certainly at the forefront of the company’s success – keeping

our staff up to date with the skills they need to work at optimum quality and efficiency levels is simply indispensable considering the continuous investments made in the technology that is used in our manufacturing processes,” Mrs Ellul explains. She continues to say that Playmobil also collaborates with academic and vocational training institutions, including the University of Malta and the Malta College for the Arts, Sciences and Technology,

with the aim of creating a direct link between industry and educational institutions so as to ensure that skills developments move in tandem with the industry’s needs. “In this respect, I would really like to see the concept of traineeships and work placements become a more integral part of the curriculum,” she states. “There is room for improvement when it comes to strengthening the links between industry and academic institutions, but there is no need to

reinvent the wheel – incorporating practical modules into courses is a proven way of ensuring that graduates join the workforce with practical knowledge that, coupled with their academic education, will give them an edge in the workplace.” And it is no wonder that continuous development is needed given the fact that Playmobil invests between 8 and 9 million each year in its machinery and technology. “One of the ‘secrets’ to Playmobil’s success is certainly its understand-

ing that continuous improvements in its technologies, machinery and work process are necessary to maintain the highest standards and productivity levels,” she explains. “The investment required is substantial, but it brings great benefits and, as such is one of the factors that have enabled the company to remain ahead in such a competitive market,” she states. In fact, thanks to the overall strategy that has been developed and tailor-made to play to Malta’s strengths, Playmobil has managed to weather the recent economic downturn very well and is looking forward to the future, and to identifying areas and opportunities for growth. “It was interesting to see how our products’ positioning within the market – as a superior quality, educational yet financially accessible toy – has in fact ensured its success through difficult times,” Mrs Ellul says. “It is important that we recognise these strengths and mix in just the right amount of innovation to appeal to today’s youngsters.” In order to achieve this delicate balance, which has ensured the product’s popularity throughout the decades, Playmobil is constantly working to develop and incorporate new concepts which children can relate to into its existing product line. “Looking to the future, we will be working to develop new product concepts and we have also set our sights on consolidating our growth throughout the next 12 months,” states Mrs Ellul. “We will also be looking at ways in which we can continue to increase efficiency, especially when it comes to taking full advantage of Malta’s small size, which gives excellent opportunities for building strong ties with complementary sectors such as education and training institutions , as well as policy makers who ultimately have such a heavy bearing on the way in which our industry operates,” she concludes.

Fast facts Number of Employees: 955 Number of male and female employees: 257 Female, 698 Male Average No. of visitors to the Fun Park each year: 55,000 Number of finished sets manufactured per year: 21 million Number of pre-bags manufactured per year: 67 million Number of figures manufactured per year: 93 million ISO certificates awarded to date: MSA EN ISO 9001:2008 and MSA EN ISO 14001:2004

BUSINESS AGENDA | JUN - AUG 2011

POLITICAL ECONOMY

“ THE EU IS NOT ADDRESSING THE CHALLENGE OF MIGRATION IN A SERIOUS ENOUGH MANNER...” - Stephen Calleya, Director,Mediterranean Academy of Diplomatic Studies

How much of an impact is the civil unrest across North Africa having on Europe? KRISTA MICALLEF TRIGONA speaks to Professor Stephen Calleya, Director of the Mediterranean Academy of Diplomatic Studies to find out what may lie ahead. In the past few months, the civil war in Libya has been splashed across the headlines of every paper. To date, it has been three months since the unrest started in Benghazi, and two months since the no fly zone was introduced; the uncertainty in Libya continues to increase and what initially might have been expected to take days or weeks, has now progressed to months. Despite the incoherent nature of the course of events across the southern shore of the Mediterranean one thing is for sure - the

events that are taking place across North Africa as well as the Middle East will go down in history. “We are experiencing a historic moment in the Mediterranean - a major change which no one had anticipated is taking place, a change that has many shades of black, white and grey,” Prof Calleya states. “How developments in North Africa and the Arab world will unfold is a completely new paradigm.” “The people of these countries are insisting on a more accountable system of governance. They are

fighting for democracy and prosperity. They want reform at a political level, doing away with the regimes that they have had for decades, but also on an economic level,” Prof Calleya explains. However, the situation across North Africa is having a major effect on Europe, and we are already beginning to see the results. One of the biggest impacts that countries on Europe’s southern borders have to deal with is the issue of migration. However, Prof Calleya strongly feels that not

enough is being done by the EU in this respect. “Solidarity is the fundamental principle upon which the EU functions, and upon which it was established. However, when you have hundreds of thousands of displaced individuals within the proximity of the Mediterranean, you would expect the EU to react immediately to this, introducing a comprehensive mechanism in order to deal with this reality,” he states. “Instead, we have a completely disjointed and disconnected approach;

one in which there is no element of burden sharing and no element of solidarity.” Prof Calleya continues to state that the EU is missing the key question at hand: the management of the trafficking of human beings. “The EU is not addressing the challenge of migration in a serious enough manner. Consequently, individuals are losing their life because of the lack of a concerted approach. My fear is that we will see even more episodes whereby hundreds and

BUSINESS AGENDA | JUN – AUG 2011

POLITICAL ECONOMY thousands of people will lose their life.” So, what solutions could be offered to this situation? “The EU could introduce mechanisms that have been tried and tested in other parts of the world, such as introducing a monitoring mechanism to manage the flow of immigrants,” Prof Calleya states, adding that, “introducing a Mediterranean coast guard, for instance, will help do away with the complete mismanagement of the reality at hand which is resulting in a number of severe consequences. More importantly, the time has also come to address this situation in a decriminalising manner, thus finding ways to manage the reality in a much more comprehensive manner, for instance through visa facilitation.” As it currently stands, the future of the situation in Libya is uncertain, however the impact that the MENA (Middle East, North Africa) region is having on Europe, in particular the Mediterranean, is forcing a complete strategic rethinking across Europe. “Within the EU, there is currently talk of introducing certain mechanisms that could assist further the changing situations across North Africa,” Prof Calleya states. “Membership within the EU is not on the cards for the south, however, there is talk of perhaps introducing what is referred to as associate membership, similar to the

likes of Switzerland, Norway or Iceland, which in essence will result in a much deeper free trade area,” Prof Calleya states. “There is also talk of introducing services and agriculture in relation to free trade liberisation – this will be a fundamental leap forward, however it is a question of introducing it to countries that are going through the reform process,” he says. “Furthermore, the EU has also indicated that it would immediately be prepared to consider providing more funding, offering support to such countries, in particular Tunisia and Egypt.” Without a doubt, global players have taken action in Libya, but so far have held back from intervening in other countries across North Africa and the Middle East, who too are experiencing severe unrest. “One important point to remember in international relations is that no two case studies are alike,” Prof Calleya says. “With what occurred in Libya, no other situation has so far demanded a similar action. In Tunisia, for example, there was a peaceful transition, the extent to which the leader left and the army did not intervene, in Egypt it was the same. In the case of the Middle East, it is clear that similar steps have started to been taken in Syria, where American sanctions have been introduced.”

“The international community is also examining the extent to which comprehensive sanctions should be introduced, with the EU also now introducing sanctions against Syria. If however the government of Syria continues to adopt repressive measures against its people, then one can anticipate that the situation could easily move in the direction of introducing mechanisms similar to those in Libya,” he continues. Despite the major changes and consequences that are taking place across the Southern border of the Mediterranean, Europe has never had a better moment to define a different course in this uncharted moment of the Euro-Med history. “Europe should be prepared to support and assist, in accordance with the people of the region, and should be prepared to react to their requests so that we can contribute positively to the challenges that they are facing,” he explains. “As a result, the Euro-Med region can move into a more prosperous and stable period in line with the title of the Barcelona Declaration: Peace, Prosperity and Stability, and without a doubt, we are very fortunate to be alive at this moment in history, and to be able to think in this direction,” Prof Calleya concludes.

The EU has also indicated that it would be prepared to consider providing more funding, offering support to such countries, in particular Tunisia and Egypt. PULL QUOTE

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS AGENDA | JUN – AUG 2011

DIPLOMACY

Euro-Mediterranean Ministerial Meeting on Industrial Cooperation: RECENT EVENTS IN THE MEDITERRANEAN CAUSE FOR CONCERN BUT ALSO MOTIVATION FOR INCREASED COOPERATION - Minister Tonio Fenech Malta recently hosted the eighth Euro-Mediterranean Ministerial Meeting on Industrial Cooperation, where the theme ‘Cooperating and Investing Towards a Sustainable Industry in the Euro-Mediterranean Region’ took centre stage. BUSINESS AGENDA speaks to Malta’s Minister for Finance, the Economy and Investment, and takes a closer look at the issues discussed.

At the recent Euro-Mediterranean Ministerial Meeting on Industrial Cooperation held in Malta recently, Minister for Finance, the Economy and Investment, Tonio Fenech, stated that while a great deal has been achieved in the last two years, “recent events in the Mediterranean have provided a significant challenge to economic growth, by affecting foreign investment and tourism in the region, while putting further pressure on commodity prices, particularly fuels.” Speaking to Business Agenda, Minister Fenech explains that the recent upheavals in the region have had a bearing on trade and investment flows in the Mediterranean. “It is hoped that the long term effects of the Tunisian and Egyptian revolutions will be positive in terms of democracy, governance, social distribution and thus of sustainable economic development. In the mean time, this new crisis is having negative short term effects on the region.”

Minister Fenech explains that the timing of the conference was critical, considering the current state of affairs across the Mediterranean Region, but the organisation of this event testifies Malta’s political will and continuous strong commitment to the cooperation process and to bring industrial policy on both sides of the Mediterranean closer together. According to Minister Fenech the meeting was also a way in which Mediterranean states could work towards deepening cooperation between them. He acknowledged that beneficial initiatives have been undertaken in the last two years, but that “it is now time to reinvigorate our efforts and to responsibly work together.” “The creation of new jobs has never been more crucial and it is therefore very important that projects and initiatives under the new work programme will focus to promote partnerships and investment

and to foster entrepreneurship and start-ups among small and medium sized enterprises in the region,” he explains. “In this respect, we must aim to foster entrepreneurship among small and medium sized enterprises in the region,” he continues. “There is a need for a better model of development in the Mediterranean, which should focus on creating more jobs, reinforcing the local industrial fabric and giving more importance to the initiatives of the South.” The meeting also focused on the key elements of the 2011-2012 work programme on Euro-Mediterranean Industrial Cooperation, particularly on improving the business environment for SMEs, with a particular focus on job creation. Other issues will include the promotion Investment and Partnerships for sustainable SME Development and issues related to Economic Cooperation and Market Access, particularly in relationship to Agreements

on Conformity Assessment and Acceptance of Industrial Products (ACAAs). In line with the main objective of the meeting, Minister Fenech explains that “the new Work Programme 2011-2012 will evolve on the need to improve enterprise competitiveness and job creation, to encourage the creation of innovative companies, to promote technology transfer and will also encourage a gradual but progressive movement towards a knowledge-based economy,” he explains. The establishment of the EuroMediterranean Free Trade Area continues to be one of Malta’s main priorities, and increased market access, the alignment of legislation and the elimination of non-tariff barriers, are to be found high on the list of topics to be tackled in this respect. “While achieving our aims will certainly demand greater effort,

the creation of a free trade area on the southern shore of the Mediterranean and between the North and the South, will lead to stronger links and increased trade and investments,” the Minister states. He goes on to say that Malta has in fact offered to assist its Mediterranean neighbours in the preparation, negotiation and implementation of the Accreditation and Conformity Assessment Agreements (ACAAs) on certain industrial products with the European Union. “Malta is in a unique position to share its technical experience given that these agreements were specifically designed for Malta prior to EU membership,” he says. “The conclusion of these Agreements with our Mediterranean partners will make such products more competitive both at the local level as well as the European market and be a major step towards free movement of goods in the Euromed area.”

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS AGENDA | JUN – AUG 2011

EU POLICY

The Revision of the EU Energy Tax Framework:

What does it mean for Maltese business? By Omar Cutajar, MBB Permanent Delegate in Brussels New plans for the introduction of a carbon tax and the restructuring of the current system of excise taxation of fuels have been unveiled by the European Commission. These new proposals will entail the revision of the current Energy Taxation Directive which had entered into force in 2004. The Energy Taxation law is a Council Directive adopted to create an EU-wide system for the taxation of all energy products. It defines the taxable energy products, the uses that make them subject to tax and the minimum levels of taxation applicable to each product depending on whether it is used as a propellant, for certain industrial and commercial purposes. To date, several contentious issues protracted the enactment of this EU legislation, primarily concerns related to the taxation of energy-intensive businesses and the arrangements for the use of diesel oil. Numerous phase-in periods were granted covering several products and exceptions for certain member states. With this background in mind, it is highly likely that the revision of the Energy Tax Directive will prove to be a highly-contentious one especially since the changes to the directive are meant to fine-tune the legal text to the requirements, objectives and ambitions of the EU’s climate change targets for 2020.

The Proposed Changes The main changes proposed by the European Commission are twofold: the introduction of a carbon dioxide tax and the fixing of energy consumption taxation based on the energy-content of the concerned fuels. With regard to CO2 taxation, the Commission is proposing a minimum carbon tax rate of €20 per tonne for fuel used for transport and heating purposes once the revised directive enters into force, possibly as early as 2013. The carbon tax would be applicable to

all economic sectors not covered by the EU’s emissions trading scheme. Renewable energy sources and agriculture would however be exempt from the CO2 tax. The excise tax rates for energy consumption would be based on the energy content of a fuel calculated in terms of euro per gigajoules rather than the volume as is presently the case. Fuel taxation would thus change to a system based on the calorific content of the fuel, thereby ensuring that products with lower energy content, namely renewable,

would carry a lower tax burden compared to conventional fuels.

ularly for industrial sectors exposed to international competition.

Assessing the implications – the cost perspective

The introduction of a CO2 tax regime has to be properly assessed and an in-depth assessment of its implications on a wide cross-section of the Maltese industrial and business scenarios thoroughly carried out. The Malta Business Bureau is committed to carrying out an impact assessment on the revision of the EU legal framework on energy taxation, focusing in particular on the fiscal inflationary impact on the pricing of fuels and electricity consumed by local firms.

Maltese business welcomes the alignment of fuel taxation to the EU’s objectives of climate change and the shift to environmentally-friendly modes of energy-generation. The ambitious fiscal reforms of energyrelated excise taxation has however to be reviewed cautiously to curb any competitiveness implications partic-

The impact assessment will not be limited to a simple cost-assessment of rising fuel and electricity prices but will analyse the broader competitiveness-related implications arising out of the levying of the carbon tax for those industrial sectors not participating in the EU’s emissions trading scheme. The potential implications of a blanket carbon tax on Maltese industrial sectors, particularly for those companies with a significant element of energy-intensive production processes, needs to be kept in mind. In addition, the knock-on cost impact of increased costs in the production of water, often used in industrial processes for cooling purposes are an additional element that will certainly have to be factored in. The reliance on desalinated water in Malta makes business particularly exposed to this additional knock-on effect. However, this is not the only

BUSINESS AGENDA | JUN - AUG 2011

EU POLICY indirect cost likely to weigh in heavily on Maltese business as a result of the introduction of an EU minimum carbon tax. The knock-on cost emanating from increased fuel pricing for the transport sector, would have considerable bearing on the delivery costs for goods in the import/export business especially due to the potential substitution effect from diesel-run to petrol-fuelled commercial vehicles. Increasing taxation levels for all traded energy products such as petrol, diesel and kerosene would inevitably lead to a disproportionate and unsustainable increase in transport costs for the import and export of goods, so vital for the livelihood of the local economy. An offsetting reduction in the tax burden for business would therefore be of paramount necessity. Assessing the implications – the policy perspective From a policy perspective, the European Commission is making a strong political case for its proposals on energy taxation based on the energy-content of fuel based on the premise that an increase in green taxation could be accompanied by a proportionate reduction of the tax burden on labour at member state level.

The political attraction of this argument is hard to counter argue and indeed constitutes a legitimate proposition worth advancing with national governments. Undoubtedly, a reduction in labour costs would be very much in line with the EU’s 2020 Strategy for Growth and Employment. A readjustment of taxation levels in the area of energy and fuel taxation should always be carried out with the intent of supporting the competitiveness of EU-based industry without compromising the transition towards a low-carbon economy, with all the consequent potential gains from green technologies and related services. The introduction of a carbonpriced mechanism is one measure by which the EU can ensure the reduction of emissions from all those industrial sectors currently not participating in the emissions trading schemes. Nonetheless, from a Maltese business perspective, reasonable doubt remains in place whether the introduction of a carbon tax, amongst other measures put forward in the Commission’s proposals on the revision of the energy tax directive, truly contribute in the most cost-efficient manner possible towards the attainment of the EU’s climate policy targets.

... reasonable doubt remains in place whether the introduction of a carbon tax, amongst other measures put forward in the Commission's proposals on the revision of the energy tax directive, truly contribute in the most costPULL efficient manner possible towards QUOTE the attainment of the EU's climate policy targets.

BUSINESS AGENDA | JUN – AUG 2011

BUSINESS AGENDA | JUN - AUG 2011

BUSINESS AGENDA | JUN – AUG 2011

EMPLOYMENT

BOOSTING EDUCATION AND SKILLS FOR A VALUE-ADDED ECONOMY PAULA GERA and EMMA LAFERLA review the European Commission’s Agenda for New Skills and Jobs, and explore the dynamics of its aim to increase employment within the EU. theless, there are still a number of concerns that need to be addressed in the local labour market so as to reach the ambitious targets set by the EU2020 Strategy.”

A sustainable and innovative economy requires a skilled workforce, and a transition towards a green, smart and innovative economy can only be achieved if EU employment and skills policies are given top priority. The EU’s Agenda for New Skills and Jobs, focuses on four key priorities which aim to assist the EU in facing the challenges of unemployment. One of the main issues that is tackled in the Agenda is flexicurity, which aims at integrating and enhancing flexibility and security simultaneously. This is identified as the primary instrument to achieve a better functioning of the labour market. Member states have been called on to reduce segmentations in the labour market, to boost gender equality and to support lifelong learning. Secondly, the EU has recognised the need for a more skilled labour force, where the supply of labour available in the market corresponds to the demand for the skills needed. As a result of the credit crunch, economic restructuring occurred, leaving a percentage of low-skilled workers unemployed. Declining sectors made low-skilled workers redundant, as they did not possess necessary expertise to integrate in emerging expanding markets. The EU has also set the aim of reducing the early school leaving rate below 10 per cent and to raise the number of young people in higher education or its equivalent to 40 per cent. On another note, but of equal importance, is the improvement of the quality of work and working conditions. In order to meet the EU2020 Strategy goals, an efficient, high-quality labour force working in a good quality and safe environment is to be accomplished. Over the last decade, there has been an overall increase in job satisfaction in Europe, yet there are still numerous occupational sectors within which workers remain vulnerable. This Agenda calls for stronger policies to promote further job creation and increase the demand for labour. It is not enough to foster

“There have been many debates in relation to the unemployment statistics of women. Whilst seeking to increase our economy and create new jobs, we need to find ways to make it easier for women to form part of the business world,” she explains. “Employers need to be encouraged and supported to introduce flexible measures and ways of working which can bring women back to the workplace.”

employment and the right skills; the labour market recovery must also include the creation of jobs which can only be brought about by economic growth. Employment rates can be increased by developing key areas of job creation, and policies which encourage entrepreneurship. Speaking about how Maltese authorities are adhering to the guidelines proposed by the Agenda for New Skills and Jobs, Dr. James Calleja, Permanent Secretary at the Ministry of Education, Employment and the Family, stressed the importance of the initiatives which are now being taken by Employment and Training Corporation (ETC) and the Malta Qualifications Council (MQC) in the run-up to 2020.

to develop skills and competences which enable learners to meet the challenges of an increasingly diverse labour market.” With regard to how Lifelong Learning Programme schemes facilitate labour force entry to value-added labour markets, Dr. Calleja noted that the response from the general public, from employers and from social partners has been encouraging as lifelong learning schemes and programmes do facilitate entry and sustainability in a value-added labour market economy.

On the importance of encouraging entrepreneurship to support job creation and economic growth, Dr. Calleja stated that “among the key competences embedded in the learning experiences in Maltese schools are entrepreneurial skills which are one of the eight key competences in lifelong learning.”

“Many employees are more aware of the fact that lifelong learning is the major key to employability and sustained employment in a competitive and demanding work environment,” he said. “An outstanding seven thousand persons have so far had learning experiences through all kinds of scholarships ranging from Basic skills to Doctoral degrees offered by the Directorate for Lifelong Learning. This has been a great achievement for Malta.”

Furthermore Dr. Calleja claimed that nowadays, “the Malta Qualifications Framework responds to the European Qualifications Framework (EQF) for lifelong learning. This gives the Island the advantage

On the other hand though, statistics show a worrying state of affairs when it comes to the rate of early school-leavers in Malta. Such persons may find it even harder to integrate in value-added labour mar-

kets due to lack of skills. According to the National Statistics Office in 2000, 54.4 per cent of young adults were early school leavers while in 2011 they amounted to 36.8 per cent. According to Dr. Calleja, “although still high when compared to the EU average of 14.9 per cent, Malta has achieved the highest percentage difference over the last decade from all member states. The percentage has decreased due to an increasing number of full-time and part-time courses in our vocational colleges. Malta is steadily raising the profile of education and training, attracting more students to further their studies.” Ms. Antoinette Caruana, Farsons Group Human Resources Manager and Chairperson of the Malta Chamber Business Education Committee, agrees with the view that the country’s requirements for a labour force with higher skills is on the rise, especially in all sectors of high value added industries. “The Maltese economy seems to have weathered the recent economic storms and this has been reflected in the increase in investment in education, which resulted in an increasing number of graduates from our university, colleges and institutes,” she stated. “Never-

She continues to say that “opportunities must carry on increasing both for those people in employment as well as those seeking employment. The responsibility for education and training is not only in the hands of the state but also in the hands of employers and employees themselves. Unions and employers need to focus much more on a common agenda that is centred on performance and growth which can translate into real benefits for the economy, our companies and their employees.” Ms. Caruana believes that “other critical issues should be also addressed through collective bargaining negotiations, for instance focusing on decisions relating to our pensions and to see how older employees can truly be encouraged to remain active and contribute in the workplace; and decisions related to unleashing the potential of the ‘hidden’ or ‘dormant’ numbers of our population who if they so choose, can be productive in the workplace as employees or even through setting up their own business which will mean new jobs and further growth in our economy.”

Ms. Gera and Ms. Laferla have recently undergone an internship with the Malta Business Bureau. They are reading for a Bachelor’s Degree in European Studies at the European Documentation and Research Centre (EDRC) within the University of Malta.

BUSINESS AGENDA | JUN - AUG 2011